Marko Cadez: ‘Closer economic cooperation will lead to normalization of Serbia-Albania political relations’

Marko Cadez: ‘Closer economic cooperation will lead to normalization of Serbia-Albania political relations’

By Ervin Lisaku Serbia, Albania economic and trade relations are rapidly overcoming their historical barriers and gaining momentum and the Tirana International Fair, Albania’s traditional year-end business gathering where Serbian companies are being represented with their largest ever delegation of

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                    [post_content] => [caption id="attachment_134676" align="alignright" width="200"]Marko Cadez, the President of the Serbian Chamber of Commerce and Industry Marko Cadez, the President of the Serbian Chamber of Commerce and Industry[/caption]

By Ervin Lisaku

Serbia, Albania economic and trade relations are rapidly overcoming their historical barriers and gaining momentum and the Tirana International Fair, Albania's traditional year-end business gathering where Serbian companies are being represented with their largest ever delegation of some 100 companies in their national stand, is the best indicator for this.

Marko Cadez, the President of the Serbian Chamber of Commerce and Industry, says his trips to Albania have been monthly during the past year, bringing Serbian companies to negotiate and sign deals with Albanian partners.

In an interview with Tirana Times ahead of the kick-off of the four-day fair on Nov. 23 , Cadez, who is also the President of the Managing Board of the Western Balkans 6 Chamber Investment Forum, says he sees great opportunities in trade and investment cooperation between the two key Western Balkan countries considering the current quite untapped potentials.

"What matters the most is the growing awareness of the fact that our economies are small, that the capacities of our companies, with the exception of few, are insufficient to independently compete at the international market, and that only together our offer can beat the competition ... It is also important that we have recognised in each other desirable partners and that there is growing confidence between our businessmen," he says.

Cadez says big Serbian companies are already examining opportunities to invest in Albania's tourism following the tax incentives the Albanian government has announced.

 

 Full interview with Marko Cadez below:

  As the 24th edition of the now traditional Tirana International Fair is approaching, Serbia has reconfirmed its participation as one of the key regional players and the biggest economy among EU aspirant Western Balkans countries. What can you tell us about this year’s participant Serbian companies and the novelties of products and services they bring to the Tirana fair?

There have never been more Serbian businessmen in Albania than these days. More than two hundred business people - representatives of about one hundred companies from Serbia have come to Tirana at the International Economic Fair and for the Assembly of the Mixed Serbian and Albanian Chamber of Commerce and Industry. In the organisation of the Chamber of Commerce and Industry of Serbia and the Development Agency of Serbia, some 41 companies will participate - twice as many as last year with a significantly diversified, richer and better quality offer at the Fair of Economy, within the national stand of 310 square meters, almost three times bigger than last year.  The majority of companies are from the building construction industry, that is, from the production of building materials, food processing and textile industries. Among the exhibitors at the national stand of Serbia there are manufacturers of machinery and equipment, agricultural mechanisation and producers of animal feed, electric materials, packaging materials, pharmaceutical, cosmetic and chemical products, as well as companies that provide engineering and marketing services. This time, Serbia will be presented by big companies, important global and regional exporters but also by less fast-growing companies that have prepared a vital and high quality offer.

In the Serbian offer to the Albanian market, there are products of the ironworks HBIS Group Serbia Iron & Steel (made of steel and white sheets),  confectionery products of the regionally renowned factory  Pionir, furnaces and cookers for households by Alfaplam, tiles and blocks by IGM Mladost, hydro and wind turbines by Sever, Galenika’s medications and medical supplies, Maxima’s paints, Unipromet's roadway protective fences, FAM's oils and lubricants, Rubin's beverages, Agranela’s  dry plums .... The company Basket of Healthy Food Made by Hand will present for the first time in Tirana an interesting production programme - products made of integral flour, while the company Conto Bene Jeans has brought to the fair denim clothes that has already become dominant in the  region, and the company GMP Jarmenovci  has brought jams and canned fruit .... Carefully chosen offer is the result of our analyses – by comparing data about the demand at the Albanian market and trends in the Albanian imports and the production and export potentials of Serbia.

 

  How much are Serbian business representatives familiar with the Albanian market and business climate considering that there is now an operational Tirana-based joint Albania-Serbia Chamber of Commerce and what do they expect from this fair?

 The Serbian economy has recognised unused potentials and the chance for the sale of its products at the Albanian market as a new export destination and Albanian companies as partners not only for trade, but also for the establishment of joint companies, joint ventures and other business arrangements. This is even more important because Albania is faced with huge works related to the modernisation of its infrastructure and investments in industry and tourism. The beginning of the implementation of announced large infrastructure and development projects in the region of the Western Balkans will open opportunities for new partnerships. The Business Fair in Tirana is an excellent opportunity for Serbian manufacturers to present their production programmes and export offers to the business community of Albania and to other countries participating in this international business event, to establish contacts with local businessmen and to start negotiations about projects that can be implemented together.

Business associations of two countries and the Mixed Albanian and Serbian Chamber of Commerce and Industry, founded during the last year's fair in Tirana, have greatly contributed by their activities to the newly aroused interest for cooperation. Both the Chamber of Commerce and Industry of Serbia and the Albanian and Serbian Chamber of Commerce and Industry have been extensively engaged lately to bring closer and to connect our economies by providing information on the conditions and possibilities of doing business at the Albanian and Serbian markets and by establishing direct contacts and organising business discussions with individual companies about concrete business arrangements. Since the date of its foundation until present time, the Mixed  Chamber has responded to almost 50 inquiries by Serbian and Albanian companies in the field of agribusiness, wood, machine, metal and electrical industries, building construction, transport and freight forwarding.

We have jointly organised visits of Serbian companies to Albania, as well as of Albanian companies to Serbia. The Chamber of Commerce and Industry of Serbia provides full support and services to its members that are interested in the Albanian market and our  door is always open to all Albanian companies that want to do business in Serbia. It seems that in the past year there is not even one month that I did not travel to Albania with some Serbian companies, such as “Lilly Drogerie” or Diary “Šabac”, which had some concrete discussions and made some agreements with their Albanian counterparts. With our assistance and mediation, companies from Serbia have met with Albanian companies such as Agna Group, Ferra & Co, PM Office and BALFIN Group. For example, the Serbian company “Milanović Engineering” has already signed the contract with the Albanian “Delia Group” which regulates partnership and joint participation in the projects related to the construction of water supply systems, drinking water treatment plants and wastewater treatment plants in Albania.

 

Albania and Serbia have made tangible progress in normalizing relations during the past three years as meeting between politicians, civil society and tourist exchanges have become quite common, but when it comes to business things seem to be moving at a slower pace with trade exchanges at almost the same level and Serbian investment to Albania slightly increasing in the past few years. Is the historical past and lack of traditional cooperation and the climate of mistrust an ongoing barrier that hampers trade and investment ties between the two main Western Balkan economies?

It is true that our trade relations are modest, that potentials for improving economic relations are large and not sufficiently used, that those who are interested in investing still weigh their decisions and that we would like that everything is going on at a much faster pace. But, I would not agree that there is no progress. On the contrary, Serbia and Albania are two economies in the region that in the past year have made the biggest advancement in connecting their business communities by means of mechanisms for strengthening regional and bilateral cooperation. The result is that the mutual trade this year, in only nine months, has been increased by more than one third compared to the same period of the previous year for both sides and that at the end of September, we already achieved the annual performance from 2016. Total trade has been increased by 36.4 percent, the export of Serbian products to Albania by 36.2 percent, and the export of Albanian products to Serbia by 37.2 percent.

There is a growing interest not only in the import-export businesses, but also in the higher forms of cooperation - individual and joint ventures and the establishment of mixed companies for the purpose of production and joint appearance not only at the Albanian and Serbian markets, but also at the third markets and in regional and international tenders.

What matters the most is the growing awareness of the fact that our economies are small, that the capacities of our companies, with the exception of few, are insufficient to independently compete at the international market, and that only together our offer can beat the competition ... It is also important that we have recognised in each other desirable partners and that there is growing confidence between our businessmen.

The breakpoint was the last year's October Business Forum in Niš and the wind in the back that we received then was the support given by the highest political leaders of our countries - personally by Prime Ministers Rama and Vučić (now the President of Serbia). We still have their support. At the same time, I am deeply convinced that our political relations will be become even better as a result of our strengthened and high quality economic relations, increased number of mutual investments and joint projects, recognised economic interests by our communities and benefits arising from regional cooperation.

 

What can the two governments do to further promote trade and investment ties and remove barriers before an apparent distant EU membership? Is the EU's regional economic area project that the Western Balkans leaders signed at the Trieste Summit this year a good tool to make the region more competitive to foreign investors as a single market of 20 million consumers instead of small markets operating individually?

 There are two key things for the future and sustainable development of our small economies, whereas we do not think only of Serbian and Albanian economies but also of economies in all countries in the Western Balkans. The first thing is - the continuation of already initiated structural reforms that will enable the acceleration of economic growth, reduce unemployment as common  and the greatest difficulty in the whole region, and lead to the increase of the standard of living of citizens. With the progress in reforms and with strengthening our economies, we will be closer to the European Union.

In parallel with internal reforms, equally important task is to strengthen regional cooperation and tighter regional integration advocated by the Western Balkans Chamber Investment Forum that gathers all chambers in the region with almost half a million member companies. As soon as we reach agreement on all issues and as soon as we eliminate obstacles for mutual cooperation our business environment will become more stimulating and we will cooperate more and more and connect our business communities and export more and attract more investors.

Therefore, it is important for our economies to mutually harmonise regulations and certificates, to synchronise inspections and monitoring and to have common regional economic area, the market without barriers so that trucks do not wait 15 hours at the borders ... this is something that we can actually  do and that cannot be harmful for anyone not even in political terms. This can be beneficial for all our economies. In this way, we can become not only a more attractive place for domestic companies but also for foreigners.  If we achieve this, global investors will not look at us as individual players but they will see the whole region with 20 million consumers. Without the region through which they can freely move, there will be no business.

By adopting the Multi-Annual Action Plan for the Regional Economic Area in Trieste in July, we have obtained a powerful instrument - an efficient tool that will help us to implement more than one hundred measures in order to open new opportunities for growth, development, better competitiveness and employment in the region. With the adoption of this document, regional economic integration has become a priority issue in agendas of both the business community and the decision-makers. On the proposal of the regional chamber, the prime ministers have personally delegated their coordinators for the purpose of more efficient implementation of the Plan.

The Western Balkans Chamber Investment Forum of six countries in the Western Balkans and our joint chamber of the region - Permanent Secretariat of the Western Balkans Chamber Investment Forum with the seat in Trieste will have an important role in the implementation of this Plan. We will measure our results by fewer unnecessary administrative procedures and by more harmonised certificates, by shorter stay of trucks at borders and by turning hours of waiting into minutes. The progress will also be measured by the increase of the number of small and medium-sized enterprises that have become the part of supply chains of large multinational companies and by the number of small enterprises that have grown into medium-sized and large ones because they have obtained the space for development at regional markets and because they have become capable enough to beat competitors at international markets. Our success will be greater if more cars cross borders, as well as more trucks or trains that transport goods and if there are more business people and more new business opportunities in the region.

 

The Serbian government has announced plans to complete the Nis-Merdare highway. Will the completion of the Durres-Prishtina-Nis highway and the normalization of relations with Kosovo help trade and investment ties and make the use of Durres Port a more suitable option for Serbian companies? 

 As confirmed by the Serbian line Ministry, the construction of the Niš –Merdare highway, 77 km long, or to be more precise, its first 40 km, from Niš to Pločnik, should start next year.

In its total length, from Niš through Merdare, Priština, Tirana to Durres, the highway will ensure the Serbian economy a better connection with the Kosovo and Albanian markets. Serbia, which is landlocked, will gain access to another port – the Port of Durres, and Albania will get the fastest and shortest connection with the European Corridor 10.  Better transportation connections are not the only benefit of the construction of this highway. The implementation of this regional infrastructure project will contribute to better networking of the business communities, lowering of costs and reducing time for transport of goods and passengers, greater attractiveness for investments and business operations of the regions through which the highway runs. And I strongly believe that closer economic cooperation will lead to the normalization of the political relations.

In addition, the announced beginning of the works will open up the opportunities for engagement of not only Serbian companies, but companies from the entire region, organized in consortia, for the purpose of joint participation in tenders for such projects, which will be invited across the region in the coming period. Because this is the first of the road and railway transport routes from the Connectivity Agenda, whose construction will be supported by the EU.  The economic strengthening of the Western Balkans, through the projects of infrastructure and business linking, among other things, is one of the foundations of the Berlin Process, and the involvement of the business communities in their implementation is one of the goals, around which the Chamber of Commerce and Industry of Serbia and Kosovo Chamber of Commerce have gathered all the chambers in the region in the Western Balkans Chamber Investment Forum more than two years ago.

 

Serbian people love Albania’s coastline and more and more have been visiting Albania in the past few years through direct Belgrade-Tirana flights. Are tourism investment on the Serbian investors’ agenda and are there any concrete projects considering the incentives the Albanian government is offering for big tourism investments?

 Tourism is certainly one of the most promising areas with the greatest potential for future cooperation additionally encouraged by new legal solutions, tax and other incentives of the Albanian state aimed at stimulating high quality services, development and investments in tourism. In addition to the increase in the number of tourists at the Albanian coast, there are more and more Serbian companies that are interested in investing in Albanian tourism. For the time being, I can tell you that the possibility of investing in Albania is seriously considered by one of the great Serbian companies which has been expanding its business operations in this field in the region in recent years. That is one of the reasons why I will again travel to Albania very soon with a representative of that company. I believe that I will be able to bring good news very soon.

 

 

 

 

 

 
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                    [post_content] => TIRANA, Nov. 22 - With some major energy-related investment nearing competition, Albania has tasked the country’s ambassadors and diplomatic representatives in more than 40 countries around the world with the difficult job of bringing new investors to the country through a more active economic diplomacy.

At a three-day conference held in Tirana last weekend, Finance Minister Arben Ahmetaj said FDI which in 2016 hit a historic high of about €1 billion thanks to some major energy-related investment is on track to drop by $200 million annually starting 2019 when major investment such as the Trans Adriatic Pipeline and the Devoll hydropower plant complete their investment stage.

"The challenge is how to replace these big investments that have entered their final investment stage when they become operational. Be aware that if we do nothing, either in improving the country's image, or finding investors be they small or strategic ones, then we will have a gap of $200 million in 2019, 2020 and 2021," minister Ahmetaj told the ambassadors, worried that none of them has suggested any potential investor so far.

Experts estimate the gap could be even bigger unless the major energy-related investments are replaced with new investments in the tourism sector where the ruling Socialists are offering major tax incentives as well as investment in the oil and mining sectors following a recovery in commodity prices after the mid-2014 slump.

The major Trans Adriatic Pipeline, already in its peak construction stage in the Albanian section, is estimated to trigger investment of about €400 million annually for 2017 and 2018.

TAP’s intensive works are expected to finish in 2018 before the project is tested and commissioned in 2019 ahead of the first gas deliveries to Europe in early 2020.

Meanwhile, Norway’s Statkraft has already made operational its first Banja HPP as part of the Devoll HPP project, one of the country largest foreign investment projects and is set to complete its second and final Moglice HPP by 2018.

The Banja and Moglice HPPs, part of the €535 million Devoll Hydropower project, are being built on the Devoll River, about 70 km southeast of Tirana.

Describing Albania's image abroad as the main issue facing the attraction of foreign investment, the finance minister urged ambassadors to contact chained-brand luxury hotels and resorts and inform them on the tax incentives Albania is offering.

In its 2018 fiscal package, the Albanian government has placed the emerging tourism sector on top of its agenda, offering tax incentives for a 10 year-period in return for investments of 8 to 15 million euros.

Albania has also been targeting to attract investors in its first special economic zone of Spitalla close to the country's biggest port of Durres and has recently cut the corporate income tax on IT companies to 5 percent, down from a standard 15 percent.

However, with the EU aspirant Western Balkan region suffering an image problem internationally due to perceived weak rule of law and high levels of corruption and Albania having one of the region’s highest tax rates, the ambassadors’ job is really tough and the small budgets available for the Albanian diplomatic staff make it even more difficult.

Mark Crawford, the president of the American Chamber of Commerce in Albania representing some of the major foreign and local investors, says high taxes are a key concern for doing business in Albania when compared with regional countries and the best promotion Albania can do is treat well the current foreign investors in the country who can be either ‘good or bad advertisement to others.‘

The main opposition Democratic Party who was in power when the major TAP and Devoll projects were contracted, says the hostile investment climate, higher taxes, corruption and crime and drugs are the main barriers to attract foreign investment.

"It's a mission impossible for the ambassadors to bring foreign investors to Albania. [Prime Minister] Rama is well aware of this because he is to blame for the hostile environment toward local and foreign businesses," says Lulzim Basha, the head of the opposition Democratic Party.

With no new major foreign investment in sight and a prolonged political deadlock ahead of the June 25 general elections, FDI suffered a blow in the first half of this year when it hit a three-year low amid poor investor confidence and uncertainties over election results

Central bank data shows FDI dropped to €380 million in the first half of this year, down from €409 million during the same period last year, registering a modest 7 percent decline, but warning of headwinds as two major ongoing energy-related projects are completed in the next couple of years.

Experts have blamed the slowdown in FDI on the sharp cut in commodity prices and Albania’s increase in the tax burden in the past few years, reducing its competitiveness compared to other regional countries applying flat tax regime of about 10 percent, despite the country’s favourable geographical location and investment opportunities, especially in the tourism industry.

The long-standing issue of clear property titles, lack of an efficient judiciary and highly perceived corruption are also considered barriers.

In a bid to compensate for the declining FDI in the post 2018 period, Prime Minister Rama has launched an ambitious €1 billion public-private partnership investment program which the IMF has described as risky for Albania's bid to reduce public debt to 60 percent of the GDP by 2020 from a current 70 percent, a high level for Albania's stage of development.

The Arbri Road linking Albania to Macedonia, some 150 schools, hospitals and healthcare facilities are on the PPP agenda.
                    [post_title] => Albania tasks ambassadors with bringing new investors to fill huge TAP, Devoll gap
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                    [post_content] => Red lines in Albania when it comes to crime and politics have increasingly become blurry in recent years, and it is a subject this newspaper has addressed in length in the past, but when it comes to cannabis cultivation, it bears repeating -- unless a thick red line is place and perpetrators who cross it are punished, Albania will continue to face tremendous problems.

It is an undeniable fact that cannabis has been grown in Albania during the past four years at an industrial scale. In fact, cannabis has become an important element in the black economy, with thousands of people employed in previous years, from those who work in the fields to those processing it. 

Some data show that domestic use of this illegal substance has increased tenfold in recent years, however, the bulk of it is destined to European markets -- by trucks, boats and even planes. 

It is clear that there are now billions of dollars being made overall, and so the question goes -- where is the money going? 

The opposition has made grand accusations about the money being used to keep the left in power through purchasing elections and influence. 

If we keep in mind one statistic global statistic, that usually only about 10 percent of the drugs are seized by law enforcement agencies -- then with the 100s of tons seized so far in Italy and Albania alone, the profits overall must be astounding. 

It is an ominous time for Albania given the strength that criminal organizations can gain with that type of money.  

In addition to cannabis, Albania is now on the map as a transit hub for harder drugs coming from the East. The trend only gets worse with profits from that source.

Only a few years ago, the situation was not this bad. So what has happened to bring the country to this point? There are only two possible scenarios.

The first one is that the government and its law enforcement agencies have lost control of the country’s territory and its borders. Law enforcement agencies have failed to do their job, to enforce the rule of law. This can be fixed. Where there is a will, there is a way. And the current government says it has a strategy that is working. 

However, the second scenario is even more troubling. It has the government itself being in the drug business, profiting from it. 

In both cases the government has failed to do its most basic duties. And no government in a normal country would be able to continue to run the country.

We don’t know which scenario we are seeing. The second needs proof, the first is evident. However, as former interior minister is now under investigation, the first scenario is still a possibility. 

Whichever way things play out, Albanians deserve better, that’s why that thick red line is important in separating the criminal economy from the honest Albanians. 

 

 
                    [post_title] => Editorial: The red line: Setting a clear boundary between crime and politics
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                    [post_author] => 29
                    [post_date] => 2017-11-17 09:27:39
                    [post_date_gmt] => 2017-11-17 08:27:39
                    [post_content] => The two days summit that wrapped up this week in the island of Crete where the two Foreign Affairs Ministers of Albania and Greece with some of their closets staff sat down and discussed a number of pending issues between the two countries was in the overall count a positive development. For many years now relations between Albania and Greece can be described frozen at best and fiery in some worst moments.  The opportunity to discuss in a safe and controlled environment about some of the most pressing disagreements between the two countries was a very positive sign that with the right political will many improvements can be made and even final solutions can be found. 

The expectations for this summit were set very high. The media speculated that by the end of the Summit the two Prime Ministers would travel to Crete and sign and shake hands. Unfortunately time showed this was not the only media speculation surrounding this important event.

Every evening some of the major Televisions in the country opened their news editions with the ‘white smoke’ news that there was a very agreeable atmosphere and that both sides were very close to reaching a common position even on extremely complicated and sensitive matters. This was said about the agreement for the maritime continental shelf, the issue of removing the ‘Law of War’ on the Greek side, the rights of immigrants, etc. Reporters claiming to have photographed draft maps and texts boasted live on Tv that the new era of relations was dawning quickly in Crete and focused also on some of the side events such as a impromptu folk dance that the ministers joined.  As the final closure of the summit and the official declarations showed, at the end the only agreement was to continue to talk, this time with a similar event in Albania. A positive atmosphere was conveyed but with none of the freaky enthusiasm that had enveloped the televisions screens so far. This was one of the most clear examples that even serious media is sliding quickly into sensationalist coverage, jumping over the facts in search of a few more audience numbers or online clicks. It is a risky form of irresponsibility given that Albanian public still depends on Tv news for most of its information about current affairs.

If only media had been so shallow, rushed and unprofessional. On the other side political forces in Albania also showed considerable flaws in dealing with the summit.

The Albanian opposition displayed a baffling and disappointing stubbornness to stand behind the former agreement reached for the maritime shelf, which was struck down by a decision of the Constitutional court. The opposition stance not only reveals utter arrogance and lack of respect for the constitutional court decision, a fault per se, but weakens the position of Albania in any negotiation by revealing the internal fractures to the Greek side. As always Albanian politicians are unable to make the difference between short term their political calculations and long term national interest. Considering how unpopular this deal was at the time in Albania, the opposition seems to have calculated even its own interest wrong.

The majority did not perform much better. They did not share the agenda of the talks or the preparation it had made with the Parliamentary Commission on Foreign Affairs. The debates in this Commission as a result degenerated into the usual political badmouthing.

One of the key messages spoken clearly in Crete by Minister Kotzias was that Greece wishes to see Albania in the European Union. This is a positive message which despite some recent development does math with the real track record of the Greek government supporting Albania in its integration path. This is the most important anchor for the future of these relations and the most positive context in which they can be transformed. Next time Albanian political class and the media that generates the public opinion here needs to show much more professionalism, reflection and openness, since these bilateral relations are of strategic importance to all Albanian citizens.
                    [post_title] => Analysis: Albanian-Greek relations reset: The risk of amateurism on the political and media side
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                    [post_date] => 2017-11-17 09:25:17
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                    [post_content] => TIRANA, Nov. 16 – Albania’s parliament is set to approve the country’s 2018 state budget with only the votes of the ruling Socialist Party, following a bitter political fight in parliament that saw the apposition accuse the government of using the state to launder drug money.

Democratic Party leader Lulzim Basha said Albania’s international partners should investigate the budget to make sure the funds are not used as part of the government’s “ties to crime.”

“Albania is a drugs factory managed by [Prime Minister] Edi Rama,” Basha told parliament, adding the government was aiming “to launder the drug money collected through the organized crime-controlled cultivation and trafficking of cannabis.”

Basha said Albanian and international law enforcement agencies should have particular focus on public-private partnerships to make sure there was no money laundering with funds from corruption and drugs.

Prime Minister Edi Rama called the accusations “laughable,” adding the state budget would increase investments while lowering public debt.

Rama said the budget and programs associated with it, like the One Billion Euros Investment Program leaving no room for doubt as to the origin of funds – with money coming from declared bank accounts.

Rama said the opposition was being unpatriotic for blackening Albania's image.

“Hurl insults at me all you want, but don't do so with Albania,” Rama told Basha in parliament.

In addition to the DP, the other major opposition party, the Socialist Movement for Integration has also said it will vote against the 2018 state budget.

“This is a budget of financial and economic devastation,” SMI’s Petrit Vasili told reporters, adding it would increase the fiscal burden on Albanian citizens while further enriching the government’s client companies.

Vasili echoed Basha’s claim that the government was aiming to use public-private partnerships and concessionary deals to help its clients and criminal organizations launder the drug money.

The Parliamentary Committee on Economy and Finance had earlier approved in principle the budget for the next years, gaining the votes of the SP MPs only, with the two opposition parties voting against.

SMI’s leader, Monika Kryemadhi said the budget favored the rich and put the poor at risk and that the government was not doing enough to reduce the gap between the two groups.

Both DP and SMI are unhappy with what they say are overall increases in taxes, while granting a helping hand to wealthy investors like the ones aiming to build luxurious five-star hotels.

Rama defended the tax incentives for five-star hotels, saying the country needed them.

The opposition says that tax cuts should go for agriculture, youth employment, poverty reduction and local production instead.

 
                    [post_title] => Budget approved amid bitter political fight
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                    [post_date] => 2017-11-14 18:12:28
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                    [post_content] => TIRANA, Nov. 14 - Albania's 2015 joining of EU sanctions over Russia’s annexation of Crimea and Russia’s countersanctions are holding back economic and trade relations between the two countries which have been limited to Albania's imports of grains, slow growth of Russian tourists and purchase of some apartments along Albania's southern coastline by Russian citizens.

Russia’s Ambassador to Albania Alexander Karpushin says trade and cooperation potential between the two countries is huge, especially in energy and tourism but is hampered by NATO-member Albania’s rather unique approach to avoid Russia.

"There are no big Russian companies in Albania and the only example of Russian investments that I am aware of is the purchase of immovable property in the Albanian coastline in Vlora, Saranda and other areas," the ambassador has told local Scan TV in a recent interview.

"I am not very enthusiastic about the current economic and political situation between our two countries considering their giant potential which remains untapped,” he added.

Responding to Albania's move to join Western sanctions in 2015, Russia imposed counter-sanctions on Albania which almost paralyzed Albania's low but rapidly growing fruit and vegetable-dominated exports to Russia.

Trade exchanges between the two countries slightly dropped to about €80 million in 2016, dominated by Albanian wheat and liquid gas imports. The exchanges have stagnated at this level for at least a decade, accounting for about 2 percent of Albania’s volume of trade.

Meanwhile, Albania’s exports to Russia during the past couple of years have almost been non-existent after Russia imposed counter-sanctions on Albanian meat, fish, dairy products, fruit and vegetables.

Albania’s fruit and vegetable-dominated exports to Russia rose to €3.3 million in 2014 ahead of the 2015 Russian counter-sanctions which saw them drop to a mere less than €500,000 in the past couple of years.

“Maybe one day, official Tirana will reconsider its approach and will no longer consider its NATO membership and European perspective as a barrier to boost ties with Russia. If we analyze Russia's relations with other Balkan countries, we will see that they all have an advantage over Albania regarding the volume of exchanges with our country,” says the Russian ambassador.

“Frankly speaking there is no other country in Europe or outside it which is trying so much to avoid its rapprochement with Russia. In this respect Albania remains really unique,” he added.

The Russian ambassador says Albania's withdrawal from joining EU sanctions against Russia is the key condition for the recovery of trade exchanges.

"I would like to remind you that this is a quite voluntary issue and nobody forced Albania to oppose Russia. That is testified by the example of Macedonia, Serbia and Bosnia and Herzegovina who did not join the Anti-Russian measures, but that didn’t not stop their step-by-step approach with the European Union and expand economic and trade relations with Russia. In this context, I can also mention Turkey which remains one of Russia's most important trading partners and the trade volume is estimated at billions of dollars,” added the ambassador.

The Russian ambassador also sees huge potentials in energy cooperation.

"There is potential in developing a partnership in the energy sector which is not affected by EU sanctions or Russian countermeasures. The thing is about the production and transmission of electricity. Russia is known for its experience in the construction of hydropower plants and nuclear plants and other sectors such as oil and gas,” said the ambassador.

Tourism is another key sector the two countries can cooperate, but a direct Moscow-Tirana airline remains a barrier.

"The main barrier for the promotion of Albania on the Russian tourist market is lack of direct flights with Russia as well absence of objective information and quality promotional materials on your country," said the Ambassador, noting that Albania attracts only about 15,000 Russian tourists a year compared to 250,000 in neighbouring Montenegro.

Albania regularly lifts visas for Russian and Arab tourists during summer in a bid to stimulate its rapidly growing tourism sector.

The ambassador says poor economic cooperation, Albania's joining of EU sanctions against Russia and Albania's failure to sign the friendship and cooperation treaty with Russia remain barriers for a possible meeting of top leaders between the two countries.

Earlier this year, Albania and Russia made official efforts to strengthen bilateral ties with a focus on the economy as an Albanian-Russian intergovernmental committee on trade and economic cooperation gathered in Tirana following an eight-year break, bringing together government authorities and business representatives from both countries to discuss untapped potential in trade exchanges and investment.

Albania-Russia relations date back to the late 1940s when the two then communist countries developed close ties until 1961 when they broke over ideological grounds.

More than two decades after the collapse of its communist regime in the early 1990s, Albania is a NATO country and an EU candidate. Russia also remains one of the key global players, being the world’s biggest energy exporter.

The Russian economy has been slowly recovering this year following recession over the past couple of years in a crisis triggered by tumbling oil prices and Western sanctions over the annexation of Crimea.
                    [post_title] => Reciprocal sanctions remain key barrier for modest Albania-Russia trade, investment ties
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                    [post_date] => 2017-11-14 15:41:26
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                    [post_content] => TIRANA, Nov. 14 - Albania is targeting to offer public private partnership incentives for the construction of new hydro and liquid gas-fired thermal power plants, worth more than €100 million as the major Trans Adriatic Pipeline, already in its peak construction, is on track to bring first Caspian gas flows to Albania and Europe by 2020.

In some amendments to the current PPP law, the ruling majority proposes fast-track procedures in providing PPP permits for the construction of new hydro and thermal power plants with an installed capacity of more than 2MW and investment value of more than €100 million.

The accelerated procedures are intended to reduce the current long procedures taking more than two years to finalize PPP contracts and attract strategic foreign investment targeting to diversify the country's domestic electricity generation. Currently wholly reliant on hydropower, domestic electricity generation is vulnerable to adverse weather conditions such as this year's prolonged drought costing state-run operators more than €100 million in costly electricity imports.

The bill, already being examined in Parliament, also paves the way for the construction of new thermal power plants, apparently liquid gas fuelled ones as the major TAP project progresses and is on track to bring first Caspian gas flows to Europe through Greece, Albania and Italy.

The largest ever foreign direct investment in Albania worth more than €1 billion, TAP has already completed three-quarters of its onshore Albania section and is on track to start its offshore section across the Adriatic to Italy next year.

Albania currently has only one thermal power plant, which due to high costs of operating on fuel and problems in its cooling system, has not been made available for use yet.

An outdated communist era thermal power plant in Fier, southwestern Albania, was closed down a decade ago due to high pollution.

TAP and cheap costs of operating on liquid gas is the only hope for the costly Vlora thermal power plant, a new World Bank-funded 97 MW $112 million low-sulphur distillate oil fuelled power plant, available for use since 2010, but which has not been put to use because of high fuel costs and a legal dispute with the Italian company that built it over the plant’s cooling system.

In its 2020-2040 natural gas master plan, the Albanian government has envisaged the construction of two gas-fired thermal power plants in Korça and Kuçova, southeast and south of the country, in the long-run.

The government expects the gas transmission infrastructure to cost the country between €150 million to €185 million, including 168 km pipeline section part of the Ionian Adriatic Pipeline, a proposed  extension of the under construction TAP that will supply natural gas to Montenegro, Bosnia and Herzegovina and Croatia through Albania in a bid to reduce dependence on Russian gas and influence in South-East Europe.

Authorities plan to first build the gas infrastructure in southern Albania where the Vlora thermal power plant and the Fier and Ballsh oil refineries are situated before shifting to other major industrial consumers in central Albania and extend gas pipes to household consumers, who already massively use gas as a cheaper alternative to electricity for cooking and heating but in often dangerous gas cylinders.

Albania has also recently offered incentives for new small solar, wind energy projects to diversify electricity resources considering the country’s favorable geographical position and Mediterranean climate with plenty of sunshine.

More than 150 small and medium-sized hydropower plants have been built in the past decade under concession contracts, including major ones such as the Ashta or Devoll HPPs developed by Austrian and Norwegian investors.

The private and concession HPPs now account for about a quarter of domestic electricity generation, but remain at risk in case of prolonged droughts such as this year’s lack of rainfall almost paralyzing domestic hydropower generation.
                    [post_title] => Albania offers incentives for liquid gas-fired thermal power plants as TAP nears completion
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                    [post_date] => 2017-11-10 10:20:55
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                    [post_content] => By Rudina Hoxha

Zdravko Počivalšek, Minister of Economic Development and Technology of Slovenia, accompanied by 24 Slovenian companies, paid a visit to Albania early this week demonstrating the full will of his own country to cooperate with Albania.

"We are ready to share our know-how and experience with you. We are willing to share the investment policy of Albanian government. In addition, we express our full support to Albania 's integration to EU,” the minister said in an exclusive interview with Tirana Times while adding "the two countries need to further promote themselves because we are far closer than we think.”

He underlined that Slovenia is aware of potentials which Albanian market can offer. “Agriculture and tourism are the prospective sectors in Albania that enable mutual projects. Tourism is an important sector of our economy as well and it contributes almost 13% of GDP. I am confident there are more options for cooperation, in promotional activities and investments. That is why I suggest that our two directorates and National Tourist Boards work together and make an action plan till the end of this year with solutions for mutual benefits,” Počivalšek said.

 Mr. You visited Albania for the first time as Slovenia’s Minister of Economy. What is the context of this visit and what do you expect from it?

It is always pleasant to travel across the globe and meet new people. New people you can do business with. I have to admit this is my first official trip to Albania. I must say I am truly satisfied by the talks we have already made with minister Ahmetaj and delegation.

The current trade exchanges between Albania and Slovenia as well as Slovenian foreign direct investment to Albania remain quite modest (trade volume at 38 million euros annually and Slovenian FDI stock to Albania at 16 million euros in mid-2017, down from 25 million at the end of 2015, according to official Albanian data). Is there room for improvement or optimism in the short-run?

 It is true that current bilateral economic cooperation between our countries is far below the potential of both economies. So, there is a lot of room for improvement! Exchange of goods was 61.2 million euros, exchange of services was 12.5 million euros. If I go more into details, Slovenia and Albania have a huge trade surplus. Hopefully, Albanian export to Slovenia will keep increasing to a reasonable level in next years. We will be keeping exporting goods to Albania, as we are doing already, so you will have a hard task to catch up with us. Because of no new major Slovenian investment in the country we came to negotiate with Albanian government to talk through all the possibilities in which both sides could benefit. Because there is always room for improvement.

 How much are Slovenian investors familiar with Albania’s business opportunities and climate and is there any real interest in any concrete sector? Are there any perceived barriers?

We are aware of potentials which Albanian market can offer. Agriculture and tourism are the prospective sectors in Albania that enable mutual projects. Tourism is an important sector of our economy as well and it contributes almost 13 % of GDP. I am confident there are more options for cooperation, in promotional activities and investments. That is why I suggest that our two directorates and National Tourist Boards work together and make an action plan till the end of this year with solutions for mutual benefits. In addition, environmental investment is a perspective for Albania as well as Slovenia, as the Slovenian industry in the field of environmental services and technology in globally competitive. There are also many companies here with us that are prepared for joint projects. We are glad that Slovenian Center for International Cooperation and Development has so far supported 5 projects in Albania:
  • Establishment of the Center for Vocational Education and Training;
  • Environmental protection activities and demonstration environmental projects.
  • Afforestation in the municipality of Erseka.
We fully support our ongoing projects which are: Sanitation of the landfill in Korca, Construction of a treatment plant for the settlement Pishkash, North. Environmental rehabilitation lakes in Tirana. What can EU aspirant Albania o to better to appeal Slovenian investors and tourists since the two counties are also linked through direct flights by a Slovenian carrier? We provide great impetus to the development of small and medium-sized enterprises.  Slovenian companies faced the challenges of the economic crisis in recent years. Now we can proudly say that the state of the economy in Slovenia is moving in a positive direction, and the prospects are also favorable. Economic growth in 2016 was 3.1% which is above the EU average. For 2017, the economic growth is predicted 4.4 % . Slovenia has made significant progress in competitiveness, which can be concluded also on the basis of Slovenia’s positive movement on many international scales. So the first thing as EU-aspirant country as you say, one of the most important things is good infrastructure. Direct flights are necessary if we would like to establish greater collaboration. And last but not least, tourism is one of the potential investment sectors for Slovenian investors.  Slovenia and Albania are two NATO allies and Adriatic countries which have almost the same population and size. However there is a huge gap in terms of development and welfare. Can you tell us Slovenia’s recipe to success? Slovenia was the most developed part of ex-Yugoslavia with strong industry, skilled workforce and efficient network of educational institutions and universities. We utilized these assets to maintain the export of goods and services at the same level even after our independence in 1991. Another beneficial factor to our export was the vicinity of our main trade partners, namely Germany, Italy, Austria and Croatia. This kept the transport costs of our companies at reasonable level. Gradually, in the late 1990s, we steered our activities in attracting foreign investors and started preparing to enter the EU, NATO and latter to adopt the EURO. In my opinion, staying an open economy and focusing strongly on needs and expectations of our main export partners in vicinity was a recipe for success. [post_title] => Slovenia’s Economy Minister: Aware of Albanian market potential [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => slovenias-economy-minister-aware-of-albanian-market-potential [to_ping] => [pinged] => [post_modified] => 2017-11-10 10:20:55 [post_modified_gmt] => 2017-11-10 09:20:55 [post_content_filtered] => [post_parent] => 0 [guid] => http://www.tiranatimes.com/?p=134502 [menu_order] => 0 [post_type] => post [post_mime_type] => [comment_count] => 0 [filter] => raw ) [8] => WP_Post Object ( [ID] => 134456 [post_author] => 29 [post_date] => 2017-11-08 14:51:22 [post_date_gmt] => 2017-11-08 13:51:22 [post_content] => TIRANA, Nov. 8 - At a time when Albania has already introduced its 2018 budget and fiscal package, a leaked confidential document showing that Albania faces the threat of being punished with a staggering €2 billion from a handful of arbitration cases with foreign companies has raised concern over the devastating effects it would have on the country’s public finances and one of Europe’s poorest economies. In a March 2017 letter to Prime Minister Edi Rama, then-Socialist Movement for Integration Justice Minister Petrit Vasili, says the ministry had been acquainted with confidential official information from the State Advocate's Office that Albania risks losing more than €2 billion from four arbitration cases alone in U.S. and European courts. "Some of the important contracts on which disputes arose, currently under examination at international arbitration courts, were ratified by the Albanian Parliament. There are also lots of cases in which line ministries have unilaterally cancelled contracts," says the letter signed by the former junior ally of the ruling Socialist Party. "Such a situation is very concerning and with severe and unpredictable consequences for public finances and public wealth, requiring in-depth analysis for each state institution individually,” adds the letter. In case such a scenario is materialized, Albania risks losing almost a fifth of its GDP and half of the annual budget, not to mention public debt costs and economic and social effects from sharp cuts in government spending. However, Albania is estimated to have lost about 8.5 billion lek (€63 million) in arbitration cases until the end of 2016, the majority of which in one case dating back to 2010. The Albanian government is also claiming hundreds of millions of euros in damages through international law firms it has contracted to represent its interests in several cases. The scenario of Albania losing such a staggering amount is also little likely as the country has settled its biggest disputes where its faced the threat of losing hundreds of millions in arbitration proceedings in out-of-court settlements as is the case with Czech Republic’s CEZ over the electricity distribution operator and a customs scanning concessionaire. While majority MPs of the parliamentary economy committee, declined to comment on the situation when recently asked by an opposition Socialist Movement for Integration MP about the situation with the arbitration cases, an economy expert says the situation is really alarming. Economy expert Zef Preçi says the Albanian government has to put an end to its practice of cancelling contracts through a minister's signature. "These cases which in essence represent a potential high bill to be footed by Albanian taxpayers is testimony to the country's ill-governance and arbitrary decision-making violating human rights and that Albania's legal system is still inefficient,” Preçi, who heads the Albanian Center for Economic Research has told a local TV. Lacking confidence in Albania’s highly perceived inefficient judiciary, foreign companies commonly put international arbitration clauses in contracts with the Albanian government in case of settling disputes. The highly perceived corrupt judiciary is about to undergo reform with the vetting of the country’s prosecutors and judges in a long-awaited process that is also expected to sharply improve the country’s business climate and boost investor confidence. "The Albanian government should have followed these cases closely and not only rely on the corruptive selection of law firms representing the country and in this way try to minimize costs for cases under examination," he adds. Albania has in several occasions picked U.K.-based Omnia Strategy, led by Cherie Blair, the wife of former British Prime Minister Tony Blair, also an adviser to the Albanian PM, to represent its interests in arbitration cases, triggering allegation of conflict of interest by British media. In its 2018 fiscal package, the Albanian government ranks potential punishment from international arbitration cases as one of the key threats facing the 2018 budget in addition to the prolonged drought paralyzing the country’s hydro-dependent domestic electricity generation. The last time the Albanian government lost a significant amount in arbitration proceedings was in 2010 when it was fined $20 million for unilaterally cancelling a contract with U.S. giant General Electric back in 2005. The €74 million project, known also as the electric train, was aimed at modernizing the Tirana-Durres railway segment which would have been linked with the Mother Theresa International Airport. More than 13 years after the project was cancelled, the key railway segment linking the country’s two largest cities has almost been abandoned by passengers due to its degraded condition. Albania has settled some key arbitration cases with Czech-owned CEZ operator and a customs scanning concessionaire amicably in the past few years, but still has some key cases pending including a tax dispute with Bankers Petroleum, the country’s biggest oil company and a dispute with Italian businessman Francesco Becchetti over cancelled waste management and renewable energy projects in Albania dating back two decades ago. The Bechetti case is one of the four unspecified cases that pose a €2 billion threat to Albania’s public finances. The Italian businessman, whose Albania assets, including a local TV station, were seized in mid-2015 on suspicion of money laundering and fraud-related offences, is seeking hundreds of millions of euros in compensation over unfinished waste management and renewable energy production projects in Albania in an arbitration trial at the Washington-based International Centre for Settlement of Investment Disputes (ICSID), part of the World Bank. The government has already paid about €2.3 million to a UK-based law firm defending Albania in the arbitration dispute. After cancelling the Bechetti contract earlier this year, the Albanian government has recently announced an Albanian-Turkish consortium as the winner of the Kalivac HPP, a €120 million with a capacity of 120 MW along the Vjosa River, southern Albania, that Bechetti was supposed to build. Projects to build new HPPs along the Vjosa River have triggered protests by environmentalists in Albania and around Europe over saving one of Europe’s last wild rivers from dams. In another key arbitration case, the Albanian government is seeking to settle a $57 million tax dispute with Bankers Petroleum, the country’s largest oil producer, dating back to 2011 when the company was run by the Canadians. The decision came after a third party auditor ordered the Albanian government to pay back Bankers Petroleum, currently operated by a Chinese company, $37 million which the then-Canadian owned company had paid in installments to the Albanian tax administration over the dispute. [post_title] => Albania faces staggering €2 bln threat in potential arbitration losses, leaked document unveils [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => albania-faces-staggering-e2-bln-threat-in-potential-arbitration-losses-leaked-document-unveils [to_ping] => [pinged] => [post_modified] => 2017-11-08 14:51:22 [post_modified_gmt] => 2017-11-08 13:51:22 [post_content_filtered] => [post_parent] => 0 [guid] => http://www.tiranatimes.com/?p=134456 [menu_order] => 0 [post_type] => post [post_mime_type] => [comment_count] => 0 [filter] => raw ) [9] => WP_Post Object ( [ID] => 134442 [post_author] => 29 [post_date] => 2017-11-06 16:19:31 [post_date_gmt] => 2017-11-06 15:19:31 [post_content] => TIRANA, Nov. 6 - In similar style to the beginning of the first 2013-2017 mandate, Socialist Party Prime Minister Edi Rama who was few months ago re-elected to rule the country for another four years in a stronger term of office, has announced the launch of three nationwide campaigns to fight organized crime, reform the tap water system and discipline river quarrying to prevent further soil erosion and flooding. The reforms come only two months after a new stronger Socialist Party government has taken over and at a time when the political situation in the country is tense following a prosecutors’ probe into former SP Interior Minister Saimir Tahiri. One of the key party figures in the previous term, Tahiri, who is one of longest serving interior ministers has come under fire over alleged links to some distant cousins arrested over drug trafficking in Italy after his name came up in Italian wiretaps. His position has been further complicated after police found few days ago two speedboat driving licences belonging to Tahiri in the car of 25-year-old businessman transporting €835,000 in cash. Tahiri, on whom the Socialist Party majority gave prosecutors permission to fully investigate into him but not arrest him, has denied any wrongdoing, calling accusations politically-motivated. The political stage has also hot over the recent surprise resignation of Albania’s top spy Visho Ajazi after about five years in duty. The opposition claims Ajazi, who has remained silent over the reason for his resignation, stepped down because of political pressure by the ruling majority. The campaigns also come at a time when the main opposition Democratic Party has announced it will stage protests over the government's alleged links to organized crime, corruption and vote buying based on the latest Tahiri case. In the first 2013-2017 mandate, Prime Minister Rama launched a late 2014 aggressive nationwide campaign against power thefts, collecting hundreds of millions in accumulated unpaid electricity bills. A year later, in late 2015, the Socialist Party-led government initiated another rather harsh nationwide campaign against tax evasion that formalized thousands of businesses previously operating informally. The same campaign was reactivated last October in a bid to further fight tax evasion, estimated at about 30 percent of the country’s GDP. The then SP-led government also included former kingmakers, the now opposition Socialist Movement for Integration, which gave the ruling coalition a three-fifth qualified majority required to make key legal changes for major reforms. The ruling Socialists now have 74 MPs out of the 140-seat MP and are 10 votes short of the 84 votes needed to approve major reforms although four small party MPs are on their side.   Organized crime In his weekly social media communication, Prime Minister Edi Rama announced on Sunday the launch of a special task force with Albania's state police to fight organized crime and corruption assisted by American FBI agents as well as Italian and German experts. The organized crime task force is being set up at a time when Albania is about to start the implementation of a long-awaited reform in the highly perceived corrupt judiciary that will start with the vetting of the country’s prosecutors and judges. It also comes amid calls by international partners to fight organized crime and put an end to cannabis cultivation which has made Albania Europe’s largest outdoor producer. "With the start of the vetting process, the prosecutor's offices will no longer be unattended churches or mosques where criminals pray, be they right or left wing ones. I am fully optimistic of the involvement of FBI agents," said Rama. A month ago, U.S. ambassador to Albania Donald Lu said Albania's government should declare war on organized crime, unveiling that “four major clans control 20 crime families that manage criminal operations that include human trafficking, blackmail, car theft and money laundering." The judiciary reform, fight against organized crime and corruption have been set as the key requirements that Albania has to meet in order to launch accession talks with the European Commission, having been an official EU candidate country since mid-2014.   Tap water, soil erosion reforms   In a meeting with the country’s mayors on Monday, Prime Minister Edi Rama warned of harsh penalties as part of two upcoming nationwide campaigns to curb abuse of tap water and discipline quarrying along the country’s rivers, the latter often blamed for massive flash floods. Prime Minister Edi Rama said the government will give a 90-day deadline to household and business consumers to self-correct before punishment begins for illegal grid connections and accumulated unpaid bills. "We are Europe's second richest country in natural [water] resources, but Europe's sole country with problems in tap water supply," Prime Minister Edi Rama said, adding that water supply hours ranging from as low as 1 hour a day in villages to 4 to 5 hours a day in towns, put Albanians in a 'survival mode.' Pointing out that Albania bills about only a quarter of tap water it produces and distributes from its dilapidated system, Rama said the critical situation can no longer be tolerated. "The situation couldn't be worse. Only a crucial reform with iron determination, similar to the reform in the electricity system, could provide a solution and way out to this degraded system, which remains in agony," he said. The Prime Minister warned of legal action on illegal water connections and water cuts for debtor consumers starting next February. Currently, only 79 percent of the population is provided water supply, compared to only 49 percent of households who are offered collection and wastewater disposal and only 10 percent of residents covered with treatment of wastewater, according to a 2016 annual report by the state-run Water Regulatory Entity, ERRU. The level of losses at 67 percent shows that the majority of water produced is lost and as a result not generating income and increasing water supply costs, remaining the main concern in the past few years. More than a third of consumers are still charged fixed rate bills due to not being equipped with water meters. In the late 2015, nationwide campaign against electricity, thousands of household and business consumers were arrested over illegal connections. Dozens of thousands are still paying their accumulated debts in installments which has made state-run OSHEE electricity operator from a loss-making company into the country’s largest and most profitable. Although significantly stabilizing the electricity sector, Rama’s rule of law platform with electricity came under criticism for targeting the poorest Albanians. One man committed suicide in prison after he was arrested for reconnecting to the electricity grid when he was cut off because he couldn’t afford to pay the bill. The Prime Minister also warned of tough measures against companies abusing quarrying along river beds which causes deviation from natural river flows, triggering floods causing dozens of millions of euros in damage. The campaign expected to start in mid-November is part of measures to curb soil erosion, one of the key causes of flash floods that have hit the country in the past few years. Albania has regularly been hit by floods in the past few years, with degradation of river beds as a result of illegal quarrying being one of the key reasons for rivers overtopping their banks in addition to climate change effects that has made rainfall more intensive. “In recent decades, flooding has worsened as a result of deforestation, overgrazing and erosion, combined with a lack of maintenance of drainage canals and pumping stations,” says the UN Food and Agriculture Organization, FAO. To curb the huge deforestation rates in the past two decades, the Albanian Parliament approved in early 2016 a ten-year moratorium on wood-cutting in the country. The ban is valid for industry or export purposes, whereas logging for heating purposes was allowed albeit under the supervision of local authorities.   [post_title] => PM Rama launches new rule of law campaigns amid tense political climate [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => pm-rama-launches-new-rule-of-law-campaigns-amid-tense-political-climate [to_ping] => [pinged] => [post_modified] => 2017-11-06 16:19:31 [post_modified_gmt] => 2017-11-06 15:19:31 [post_content_filtered] => [post_parent] => 0 [guid] => http://www.tiranatimes.com/?p=134442 [menu_order] => 0 [post_type] => post [post_mime_type] => [comment_count] => 0 [filter] => raw ) ) [post] => WP_Post Object ( [ID] => 134675 [post_author] => 29 [post_date] => 2017-11-23 16:42:38 [post_date_gmt] => 2017-11-23 15:42:38 [post_content] => [caption id="attachment_134676" align="alignright" width="200"]Marko Cadez, the President of the Serbian Chamber of Commerce and Industry Marko Cadez, the President of the Serbian Chamber of Commerce and Industry[/caption] By Ervin Lisaku Serbia, Albania economic and trade relations are rapidly overcoming their historical barriers and gaining momentum and the Tirana International Fair, Albania's traditional year-end business gathering where Serbian companies are being represented with their largest ever delegation of some 100 companies in their national stand, is the best indicator for this. Marko Cadez, the President of the Serbian Chamber of Commerce and Industry, says his trips to Albania have been monthly during the past year, bringing Serbian companies to negotiate and sign deals with Albanian partners. In an interview with Tirana Times ahead of the kick-off of the four-day fair on Nov. 23 , Cadez, who is also the President of the Managing Board of the Western Balkans 6 Chamber Investment Forum, says he sees great opportunities in trade and investment cooperation between the two key Western Balkan countries considering the current quite untapped potentials. "What matters the most is the growing awareness of the fact that our economies are small, that the capacities of our companies, with the exception of few, are insufficient to independently compete at the international market, and that only together our offer can beat the competition ... It is also important that we have recognised in each other desirable partners and that there is growing confidence between our businessmen," he says. Cadez says big Serbian companies are already examining opportunities to invest in Albania's tourism following the tax incentives the Albanian government has announced.    Full interview with Marko Cadez below:   As the 24th edition of the now traditional Tirana International Fair is approaching, Serbia has reconfirmed its participation as one of the key regional players and the biggest economy among EU aspirant Western Balkans countries. What can you tell us about this year’s participant Serbian companies and the novelties of products and services they bring to the Tirana fair? There have never been more Serbian businessmen in Albania than these days. More than two hundred business people - representatives of about one hundred companies from Serbia have come to Tirana at the International Economic Fair and for the Assembly of the Mixed Serbian and Albanian Chamber of Commerce and Industry. In the organisation of the Chamber of Commerce and Industry of Serbia and the Development Agency of Serbia, some 41 companies will participate - twice as many as last year with a significantly diversified, richer and better quality offer at the Fair of Economy, within the national stand of 310 square meters, almost three times bigger than last year.  The majority of companies are from the building construction industry, that is, from the production of building materials, food processing and textile industries. Among the exhibitors at the national stand of Serbia there are manufacturers of machinery and equipment, agricultural mechanisation and producers of animal feed, electric materials, packaging materials, pharmaceutical, cosmetic and chemical products, as well as companies that provide engineering and marketing services. This time, Serbia will be presented by big companies, important global and regional exporters but also by less fast-growing companies that have prepared a vital and high quality offer. In the Serbian offer to the Albanian market, there are products of the ironworks HBIS Group Serbia Iron & Steel (made of steel and white sheets),  confectionery products of the regionally renowned factory  Pionir, furnaces and cookers for households by Alfaplam, tiles and blocks by IGM Mladost, hydro and wind turbines by Sever, Galenika’s medications and medical supplies, Maxima’s paints, Unipromet's roadway protective fences, FAM's oils and lubricants, Rubin's beverages, Agranela’s  dry plums .... The company Basket of Healthy Food Made by Hand will present for the first time in Tirana an interesting production programme - products made of integral flour, while the company Conto Bene Jeans has brought to the fair denim clothes that has already become dominant in the  region, and the company GMP Jarmenovci  has brought jams and canned fruit .... Carefully chosen offer is the result of our analyses – by comparing data about the demand at the Albanian market and trends in the Albanian imports and the production and export potentials of Serbia.     How much are Serbian business representatives familiar with the Albanian market and business climate considering that there is now an operational Tirana-based joint Albania-Serbia Chamber of Commerce and what do they expect from this fair?  The Serbian economy has recognised unused potentials and the chance for the sale of its products at the Albanian market as a new export destination and Albanian companies as partners not only for trade, but also for the establishment of joint companies, joint ventures and other business arrangements. This is even more important because Albania is faced with huge works related to the modernisation of its infrastructure and investments in industry and tourism. The beginning of the implementation of announced large infrastructure and development projects in the region of the Western Balkans will open opportunities for new partnerships. The Business Fair in Tirana is an excellent opportunity for Serbian manufacturers to present their production programmes and export offers to the business community of Albania and to other countries participating in this international business event, to establish contacts with local businessmen and to start negotiations about projects that can be implemented together. Business associations of two countries and the Mixed Albanian and Serbian Chamber of Commerce and Industry, founded during the last year's fair in Tirana, have greatly contributed by their activities to the newly aroused interest for cooperation. Both the Chamber of Commerce and Industry of Serbia and the Albanian and Serbian Chamber of Commerce and Industry have been extensively engaged lately to bring closer and to connect our economies by providing information on the conditions and possibilities of doing business at the Albanian and Serbian markets and by establishing direct contacts and organising business discussions with individual companies about concrete business arrangements. Since the date of its foundation until present time, the Mixed  Chamber has responded to almost 50 inquiries by Serbian and Albanian companies in the field of agribusiness, wood, machine, metal and electrical industries, building construction, transport and freight forwarding. We have jointly organised visits of Serbian companies to Albania, as well as of Albanian companies to Serbia. The Chamber of Commerce and Industry of Serbia provides full support and services to its members that are interested in the Albanian market and our  door is always open to all Albanian companies that want to do business in Serbia. It seems that in the past year there is not even one month that I did not travel to Albania with some Serbian companies, such as “Lilly Drogerie” or Diary “Šabac”, which had some concrete discussions and made some agreements with their Albanian counterparts. With our assistance and mediation, companies from Serbia have met with Albanian companies such as Agna Group, Ferra & Co, PM Office and BALFIN Group. For example, the Serbian company “Milanović Engineering” has already signed the contract with the Albanian “Delia Group” which regulates partnership and joint participation in the projects related to the construction of water supply systems, drinking water treatment plants and wastewater treatment plants in Albania.   Albania and Serbia have made tangible progress in normalizing relations during the past three years as meeting between politicians, civil society and tourist exchanges have become quite common, but when it comes to business things seem to be moving at a slower pace with trade exchanges at almost the same level and Serbian investment to Albania slightly increasing in the past few years. Is the historical past and lack of traditional cooperation and the climate of mistrust an ongoing barrier that hampers trade and investment ties between the two main Western Balkan economies? It is true that our trade relations are modest, that potentials for improving economic relations are large and not sufficiently used, that those who are interested in investing still weigh their decisions and that we would like that everything is going on at a much faster pace. But, I would not agree that there is no progress. On the contrary, Serbia and Albania are two economies in the region that in the past year have made the biggest advancement in connecting their business communities by means of mechanisms for strengthening regional and bilateral cooperation. The result is that the mutual trade this year, in only nine months, has been increased by more than one third compared to the same period of the previous year for both sides and that at the end of September, we already achieved the annual performance from 2016. Total trade has been increased by 36.4 percent, the export of Serbian products to Albania by 36.2 percent, and the export of Albanian products to Serbia by 37.2 percent. There is a growing interest not only in the import-export businesses, but also in the higher forms of cooperation - individual and joint ventures and the establishment of mixed companies for the purpose of production and joint appearance not only at the Albanian and Serbian markets, but also at the third markets and in regional and international tenders. What matters the most is the growing awareness of the fact that our economies are small, that the capacities of our companies, with the exception of few, are insufficient to independently compete at the international market, and that only together our offer can beat the competition ... It is also important that we have recognised in each other desirable partners and that there is growing confidence between our businessmen. The breakpoint was the last year's October Business Forum in Niš and the wind in the back that we received then was the support given by the highest political leaders of our countries - personally by Prime Ministers Rama and Vučić (now the President of Serbia). We still have their support. At the same time, I am deeply convinced that our political relations will be become even better as a result of our strengthened and high quality economic relations, increased number of mutual investments and joint projects, recognised economic interests by our communities and benefits arising from regional cooperation.   What can the two governments do to further promote trade and investment ties and remove barriers before an apparent distant EU membership? Is the EU's regional economic area project that the Western Balkans leaders signed at the Trieste Summit this year a good tool to make the region more competitive to foreign investors as a single market of 20 million consumers instead of small markets operating individually?  There are two key things for the future and sustainable development of our small economies, whereas we do not think only of Serbian and Albanian economies but also of economies in all countries in the Western Balkans. The first thing is - the continuation of already initiated structural reforms that will enable the acceleration of economic growth, reduce unemployment as common  and the greatest difficulty in the whole region, and lead to the increase of the standard of living of citizens. With the progress in reforms and with strengthening our economies, we will be closer to the European Union. In parallel with internal reforms, equally important task is to strengthen regional cooperation and tighter regional integration advocated by the Western Balkans Chamber Investment Forum that gathers all chambers in the region with almost half a million member companies. As soon as we reach agreement on all issues and as soon as we eliminate obstacles for mutual cooperation our business environment will become more stimulating and we will cooperate more and more and connect our business communities and export more and attract more investors. Therefore, it is important for our economies to mutually harmonise regulations and certificates, to synchronise inspections and monitoring and to have common regional economic area, the market without barriers so that trucks do not wait 15 hours at the borders ... this is something that we can actually  do and that cannot be harmful for anyone not even in political terms. This can be beneficial for all our economies. In this way, we can become not only a more attractive place for domestic companies but also for foreigners.  If we achieve this, global investors will not look at us as individual players but they will see the whole region with 20 million consumers. Without the region through which they can freely move, there will be no business. By adopting the Multi-Annual Action Plan for the Regional Economic Area in Trieste in July, we have obtained a powerful instrument - an efficient tool that will help us to implement more than one hundred measures in order to open new opportunities for growth, development, better competitiveness and employment in the region. With the adoption of this document, regional economic integration has become a priority issue in agendas of both the business community and the decision-makers. On the proposal of the regional chamber, the prime ministers have personally delegated their coordinators for the purpose of more efficient implementation of the Plan. The Western Balkans Chamber Investment Forum of six countries in the Western Balkans and our joint chamber of the region - Permanent Secretariat of the Western Balkans Chamber Investment Forum with the seat in Trieste will have an important role in the implementation of this Plan. We will measure our results by fewer unnecessary administrative procedures and by more harmonised certificates, by shorter stay of trucks at borders and by turning hours of waiting into minutes. The progress will also be measured by the increase of the number of small and medium-sized enterprises that have become the part of supply chains of large multinational companies and by the number of small enterprises that have grown into medium-sized and large ones because they have obtained the space for development at regional markets and because they have become capable enough to beat competitors at international markets. Our success will be greater if more cars cross borders, as well as more trucks or trains that transport goods and if there are more business people and more new business opportunities in the region.   The Serbian government has announced plans to complete the Nis-Merdare highway. Will the completion of the Durres-Prishtina-Nis highway and the normalization of relations with Kosovo help trade and investment ties and make the use of Durres Port a more suitable option for Serbian companies?  As confirmed by the Serbian line Ministry, the construction of the Niš –Merdare highway, 77 km long, or to be more precise, its first 40 km, from Niš to Pločnik, should start next year. In its total length, from Niš through Merdare, Priština, Tirana to Durres, the highway will ensure the Serbian economy a better connection with the Kosovo and Albanian markets. Serbia, which is landlocked, will gain access to another port – the Port of Durres, and Albania will get the fastest and shortest connection with the European Corridor 10.  Better transportation connections are not the only benefit of the construction of this highway. The implementation of this regional infrastructure project will contribute to better networking of the business communities, lowering of costs and reducing time for transport of goods and passengers, greater attractiveness for investments and business operations of the regions through which the highway runs. And I strongly believe that closer economic cooperation will lead to the normalization of the political relations. In addition, the announced beginning of the works will open up the opportunities for engagement of not only Serbian companies, but companies from the entire region, organized in consortia, for the purpose of joint participation in tenders for such projects, which will be invited across the region in the coming period. Because this is the first of the road and railway transport routes from the Connectivity Agenda, whose construction will be supported by the EU.  The economic strengthening of the Western Balkans, through the projects of infrastructure and business linking, among other things, is one of the foundations of the Berlin Process, and the involvement of the business communities in their implementation is one of the goals, around which the Chamber of Commerce and Industry of Serbia and Kosovo Chamber of Commerce have gathered all the chambers in the region in the Western Balkans Chamber Investment Forum more than two years ago.   Serbian people love Albania’s coastline and more and more have been visiting Albania in the past few years through direct Belgrade-Tirana flights. Are tourism investment on the Serbian investors’ agenda and are there any concrete projects considering the incentives the Albanian government is offering for big tourism investments?  Tourism is certainly one of the most promising areas with the greatest potential for future cooperation additionally encouraged by new legal solutions, tax and other incentives of the Albanian state aimed at stimulating high quality services, development and investments in tourism. In addition to the increase in the number of tourists at the Albanian coast, there are more and more Serbian companies that are interested in investing in Albanian tourism. For the time being, I can tell you that the possibility of investing in Albania is seriously considered by one of the great Serbian companies which has been expanding its business operations in this field in the region in recent years. That is one of the reasons why I will again travel to Albania very soon with a representative of that company. I believe that I will be able to bring good news very soon.             [post_title] => Marko Cadez: ‘Closer economic cooperation will lead to normalization of Serbia-Albania political relations’ [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => marko-cadez-closer-economic-cooperation-will-lead-to-normalization-of-serbia-albania-political-relations [to_ping] => [pinged] => [post_modified] => 2017-11-23 16:42:38 [post_modified_gmt] => 2017-11-23 15:42:38 [post_content_filtered] => [post_parent] => 0 [guid] => http://www.tiranatimes.com/?p=134675 [menu_order] => 0 [post_type] => post [post_mime_type] => [comment_count] => 0 [filter] => raw ) [queried_object] => stdClass Object ( [term_id] => 52 [name] => Premium [slug] => premium [term_group] => 0 [term_taxonomy_id] => 52 [taxonomy] => category [description] => Please subscribe to have access to articles in our premium section. 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