Albanian football association in legal battle with gov’t over ‘denied’ UEFA tax refunds

Albanian football association in legal battle with gov’t over ‘denied’ UEFA tax refunds

By Ervin Lisaku TIRANA, Jan. 30 – Failure to settle amicably a tax dispute on the under-construction National Arena stadium, the new home of Albania’s national side in the Albanian capital city Tirana, has taken Albania’s football association and the

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Protests force authorities to back off from HPP, oil search plans at protected areas

Protests force authorities to back off from HPP, oil search plans at protected areas

TIRANA, Jan. 28 – Protests by local residents and environmentalists over the construction of a small hydropower plant next to a protected Canyon and oil search plans at a national park have led to the suspension of works and a

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Newly-imposed ban drastically cuts gambling in Albania

Newly-imposed ban drastically cuts gambling in Albania

By Ervin Lisaku TIRANA, Jan. 28 – Legal changes have turned Albania from a gambling paradise to one of the countries applying one of Europe’s harshest legislation on games of chance, but facts on the ground show gambling continues although

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Editorial: Lessons on how to escape political responsibility

Editorial: Lessons on how to escape political responsibility

TIRANA TIMES EDITORIAL Examining the performance of the chief of the executive and his new cabinet members, by now it is clear that 2019 will be the year spent on designing mechanisms, choosing people and perfecting styles on how to

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UK-based WFD launches Tirana office under Western Balkan Initiative

UK-based WFD launches Tirana office under Western Balkan Initiative

TIRANA, Jan. 23 – The Westminster Foundation for Democracy, a UK government agency committed in strengthening democracy around the world, announced the opening of its Albania office on Wednesday in a ceremony held at the Rogner Hotel. The launch of

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Albania wins over Kosovo-Serbia trade war

Albania wins over Kosovo-Serbia trade war

TIRANA, Jan. 24 – Albania is winning over the Kosovo-Serbia trade war, having sharply increased exports to neighboring Kosovo, a natural ethnic Albanian-dominated trading partner, where gains in market share could be even bigger if Albania produced more and current tariff

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Opposition: “Gov’t is lying over cancelled PPP funds’ allocation to public universities”

Opposition: “Gov’t is lying over cancelled PPP funds’ allocation to public universities”

TIRANA, Jan. 22 – After the country’s Socialist government announced it will be cancelling a highway PPP awarded to one of the country’s business  oligarchs to channel more money to public universities in the wake of massive student protests, the

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Ruling Socialists cancel €244 mln PPP to Albanian ‘oligarch’ over alleged links to offshore scandal

Ruling Socialists cancel €244 mln PPP to Albanian ‘oligarch’ over alleged links to offshore scandal

By Ervin Lisaku TIRANA, Jan. 21 – Faced with mounting pressure over a recent public private partnership scandal and student protests over changes and higher financing in Albania’s public higher education system, the Albanian government has cancelled a costly highway

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‘Escobar of the Balkans’  and the destructive legacy of narco-influence in politics

‘Escobar of the Balkans’ and the destructive legacy of narco-influence in politics

It is often said that although art is supposed to be ‘life in extrems’, real life very frequently surpasses art in its exotic extremes. One of these times happened this week for Albanians who watched Klement Balili turn himself in

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Editorial: A caretaker government of one

Editorial: A caretaker government of one

TIRANA TIMES EDITORIAL Seeing that the President of the Republic, Ilir Meta, did not bulge from his decision to reject the proposed name of Gent Cakaj as a Foreign Minister, Prime Minister Rama designated himself as an acting Foreign Minister.

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                    [post_content] => By Ervin Lisaku

TIRANA, Jan. 30 – Failure to settle amicably a tax dispute on the under-construction National Arena stadium, the new home of Albania’s national side in the Albanian capital city Tirana, has taken Albania’s football association and the government to court where football officials are seeking back €2 million in value added tax refunds.

Albania’s football association says failure to get back €2 million in VAT refunds from UEFA funding of €10 million risks the completion of the National Arena stadium. The so called ‘tower stadium’ was initially scheduled to become operational in early 2019 ahead of Albania’s first Euro 2020 qualifiers in March, but delays in construction works and a tax dispute have now postponed plans for initial tests to mid-2019 and the stadium is likely to be ready for next September or November when Albania play their closing home Euro qualifiers against Iceland, Andorra and France.

The legal battle at the first instance Tirana Administrative Court comes after a tax appeals body of the finance ministry turned down a complaint over VAT refunds due to delays in applying with tax authorities to get back the 20 percent amount.

Both the Albanian football association and the government are joint venture partners in the enterprise set up in 2014 to oversee the construction of the new stadium in the country.

The majority 75 percent stake at the “Qendra Sportive Kuq e Zi’ company [The Red and Black sports center named after Albania’s national side jersey] is held by the football association with the remaining 25 percent minority stake held by the Albanian government.

"We were told by tax authorities that our [VAT refund] application was delayed for several days, but I don't think this is the case to cancel it. We appealed it with the finance ministry and it was again refused,” Football Association President Armand Duka said in a TV interview in late December 2018.

“I have talked to the Prime Minister and from the conversation I had with him, he is between two fires. The football association has obtained 100 percent of the stadium funds from UEFA and there can be no such financing where state authorities seek to take advantage of UEFA donations," he added.

According to Duka, last December’s visit to Albania by UEFA’s Secretary General Theodore Theodoridis, who also reportedly met Prime Minister Edi Rama, was also related to the tax dispute over funds donated by the European football’s governing body.

In an announcement on its website, the Tirana Administrative Court says the football association is seeking the cancellation of decisions by the Tirana Regional Directorate and the tax appeals body at the finance ministry and the initial trial was planned for Jan. 22, 2019.

However, unless settled amicably, the legal battle in Albania's three-tier administrative court system could take years due to a huge backlog of cases at the Administrative Appeals Court and the Administrative College of the Supreme Court, currently both functioning with limited staff due to a judiciary reform having ousted several judges for failing to justify their assets and delays in the establishment of the new justice bodies leading to key vacancies.

With construction works already in their final stage following the mid-2016 demolition of the old “Qemal Stafa” stadium, the football association has earlier warned failure to get back the €2 million tax refund would call the stadium completion into question.

The football association has hinted of politically motivated reasons behind the blockage, apparently related to incumbent football association head Armand Duka claiming a fifth consecutive term of office in early 2018 in a contested race by main rival Bashkim Fino, a former Prime Minister and current ruling Socialist Party MP.

 

New ‘tower’ stadium

The new ‘National Arena’ stadium is a €50 million public private partnership deal with a capacity of 22,000 seats that will also feature commercial, entertainment and accommodation facilities in a high-rise tower next to it. The Albanian football association has invested €10 million through UEFA funding.

An Albanian-owned company has invested €40 million to build the stadium in return for being offered public land and a permit to build a 24-storey tower next to it that will host commercial facilities, including a hotel that will be managed by US-based hotel giant Marriott International through a franchise deal with the developers, benefiting tax cuts as a high-end tourism investment in a popular downtown Tirana area.

The new National Arena stadium is being built on the site of former ‘Qemal Stafa’ stadium in Tirana, which ceased being used for international matches in 2013 after failing to meet international standards. Unlike the old stadium, the new facility has no athletics track, a key barrier for some of Albania’s athletes like Luiza Gega, a medal-winning middle-distance runner.

Former ‘Qemal Stafa’ stadium served as Albania’s national stadium for over 70 years since 1946 when it was inaugurated for the Balkan Cup as an Italian-designed facility.

Lacking a permanent home, the Albanian national football team has in the past five years played their home matches at the newly reconstructed Elbasan Arena and Shkodra stadiums, both reconstructed through government funding of around €14 million.

The Albanian football association which has invested around €10 million in the stadium project through UEFA funds will also get considerable facilities, but not have its headquarters there. The new football association headquarters that will also serve as an accommodation center for the national side are already being built elsewhere in Tirana at a former sports complex.

Albania will start their Euro 2020 qualifiers on March 22, 2019 with a home encounter against Turkey, a much more experienced national side, but who have been struggling to qualify for major tournaments during the past decade following a golden period in the 2000s.

Having missed a chance to keep qualifying hopes alive through the inaugural UEFA Nations League by finishing bottom in their League C, Group 1, and having also lost much of their Euro 2016 qualifying campaign shine during the past couple of years, Albania will be trying for another miracle qualification in a tough group stage where France are undisputed favorites for a top finish and Iceland, Turkey and Albania will rival for a second spot that also earns direct qualification for the Euro 2020 finals.
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                    [post_content] => TIRANA, Jan. 28 – Protests by local residents and environmentalists over the construction of a small hydropower plant next to a protected Canyon and oil search plans at a national park have led to the suspension of works and a change of plans over environmental concerns in two southern Albanian areas where tourism is considered a major future opportunity for thinly populated villages that have faced mass migration over the past three decades.

While oil search plans by Shell oil giant and the Albanian government are on track to be dropped at the Zagoria protected area off the southern Albanian UNESCO World Heritage city of Gjirokastra, damage has already been caused to Holta Canyon outside the town of Librazhd, where an Albanian company has concreted the entry to the canyon as part of a permit it received last year to build a new hydropower plant.

Facing pressure by local residents, environmentalists and adventure travel activists, the government has ordered the suspension of works until the hydropower permit is revised, but huge uncertainties remain over its cancellation as the company that is building the small HPP, a €3.6 million investment next to a protected area and monument such as the Canyon, claims it has received all required permits to launch construction works. An apparent legal battle could force the Albanian government to face penalties over a potential unilateral cancellation of a permit it issued in April 2018.

“Many HPP permits have been awarded in the Gramsh region, but the Holta HPP is a scandal where nature and tourism are being destroyed for the benefit of short-sighted people," the Gramishi Online activists say in a Facebook post.

 

HPP screening

New Energy Minister Belinda Balluku says she has ordered the suspension of HPP construction permits due to more than a hundred concession contracts having remained on paper and environmental concerns over the areas the HPPs are planned.

The minister says Albania currently has 96 operational small and medium-sized HPPs which the government supports by purchasing electricity at regulated prices, compared to contracts for 440 such HPPs.

The suspension of works for all HPPs that have obtained licenses or are carrying construction works until a screening process is carried out has worried hydropower plant investors who say the surprise decision triggers uncertainties over current and future investment plans in a sector that is estimated to have attracted more than €1 billion in local and foreign investment over the past decade.

Protests by local residents in the past couple of years and legal battles could not stop the Vjosa and Valbona rivers, two of Europe's last wild rivers located south and north of Albania, from being dammed with the first hydropower plants after previous government decisions sealing their fate and the authorities refusing to back off over penalties they could face in case of unilateral cancellations.

A recent report by Bankwatch, a Czech Republic-based environmental and human rights group, has shown the boom in hydropower plant construction in the past decade has put significant pressure on the environment in Albania and international financial institutions are also to blame for this for financing the controversial projects

“Small-scale hydropower projects often do not pass through a comprehensive Environmental Impact Assessments (EIAs) at all, which in a fragile governance context leads to outright destruction of the environment,” says Bankwatch which examined two projects financed by London-based European Bank for Reconstruction and Development in Albania including one in the Shebenik-Jabllanicë National Park, east of Albania close to the Macedonia border.

In 2017, a new law on protected areas finally forbid the construction of hydropower plants in Albania national parks, but this move comes too late for those plants such as Rapuni located at in the protected area of Shebenik-Jabllanice.

Albania produces all of its domestic electricity from hydropower, three-quarters of which from three major state-run HPPs in a situation that often places the country in difficulty in case of prolonged droughts when the country is forced to make costly power imports.

Authorities are now mulling reactivating a thermal power plant on cheaper natural gas and setting up the first solar power plants through incentives that would reduce the country’s hydro-electricity dependence.

 

Holta Canyon

The Librazhd Municipality is a local government unit of some 32,000 residents located some 70 km south of Tirana in a one-and-a half hour drive. The region boasts a national park and several natural wonders, among which the Holta Canyon, is one of the key tourist attractions.

"The Holta Canyon, has remained fairly unexplored from local and foreign tourists alike. The Canyon was created by the erosion of the river Holta. It extends 3 kilometers from the village of Bardhaj to Kabash, with surrounding valley slopes of 100-150 meters and with crystalline waters of depths of around 3 meters,” says the IntoAlbania travel portal.

“Karst caves created by limestone rocks, stalactites and stalagmites of rare beauty can be found there. Silence and echoes, lush greenery hanging from the slopes above you and beautiful blue waters caressing your feet and creating small waterfalls along the way. A bit further, thermal waters where you can relax for a moment of your journey," it adds.

 

Oil plans also dropped

Last week, the Albanian government and Shell oil giant also announced the drop of plans at the protected Zagoria area, an emerging adventure travel destination, where initial plans were to conduct a seismic study that did not exclude the use of explosives or specialized trucks in the search for possible petroleum, natural gas and mineral deposits.

Facing protests by local residents and environmentalist, both Shell and the Albanian government declared they would drop plans.

The main opposition Democratic Party claimed the oil search plans had been adopted under a government decision as part of 2018 deal awarding Shell oil exploration rights in Block 4, a southern Albanian area that involves seven municipalities among which Libohova, a local government unit in the region of Gjirokastra that also include the protected Zagoria area.

The whole Libohova municipality has a resident population of fewer than 4,000 with some 500 estimated to live in Zagoria, an areas relying on farming, livestock and the emerging tourism.

"The Zagoria area is one of the richest Albania areas boasting Byzantine legacy such as churches, bridges and archeological sites that make up huge potential for the sustainable local development of the area. Oil search operations or any other industrial activity in the area would pose a danger to the protected values," renowned activists of the Forum for the Protection of Cultural Heritage have said.

Having made some major discoveries but not engaged in oil production yet, Albania is one of the few countries where oil giant Shell did not suspend its oil exploration operations following the mid-2014 slump in oil prices.
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                    [post_content] => By Ervin Lisaku

TIRANA, Jan. 28 - Legal changes have turned Albania from a gambling paradise to one of the countries applying one of Europe’s harshest legislation on games of chance, but facts on the ground show gambling continues although at a drastic decline compared to until late December 2018 before a gambling ban entered into force.

Albanian authorities have launched a nationwide crackdown on illegal gambling operations during the past month, initiating legal action against more than a dozen people, including three gamblers, for organizing illegal gambling activities, in legal sanctions that could see them fined or face prison sentences of up to six months.

In addition, authorities have ordered the country’s internet service providers to deny access to more than 1,600 local and international online betting sites, on a ‘ban list’ that has been regularly updated by the gambling supervisory unit and police officials with 10 lists until Jan. 24.

The partial nationwide gambling ban that the Albanian ruling Socialist Party majority approved in late October 2018, banned electronic casinos from residential areas and temporarily froze for an undetermined period what had become a booming sports betting industry, including online betting, until new legislation that could turn it into a state monopoly or set new rules to discipline their operation.

Yet, the country’s sole real casino offering live table games and located downtown Tirana was not affected by recent legal changes and anecdotal evidence shows gamblers are queuing to go there. Legal changes also do not apply to TV bingos, including the National Lottery, also offering scratch tickets.

Meanwhile, electronic casinos are expected to be relocated to 5-star hotels or tourist areas with national importance that are yet to be determined by the government.

 

Battling illegal gambling

A number of former sports betting shops that have now turned into coffee bars are reported to offer illegal online gambling services, but only for gamblers betting medium to large sums, putting an end to bets below $10 dollars that a majority of Albanians used to place, starting as low as 100 lek (€0.8; $0.9) for predicting football matches.

While access to several websites on the Albanian ‘ban list’ of 1,627 portals is still available, experts say banning online gambling is quite a mission impossible due to a variety of opportunities that technology enables, including through proxy services or virtual private networks hiding the real location of gamblers.

In addition, having a credit card and opening an account with one of the online betting portals, can enable gamblers to bet online and use popular e-wallets to deposit and withdraw funds at lower costs compared to commercial banks.

 

Rental market effect

Hundreds of electronic casinos and thousands of betting shops nationwide have closed down this year, increasing supply in the rental market, where demand is satisfactory only in capital city Tirana, yet at much lower rental rates compared to the lucrative contracts landlords had with gambling business.

Outside Tirana, hundreds of former casino and betting shops have closed down and demand to rent them is poor due to the difficulties that small businesses are facing amid a hike in taxes, poor consumption and ever rising competition with shopping centers and supermarket chains that are gaining constant market shares.

Real estate agents say the massive closure of casinos and betting shops will sharply increase rental vacancy rates and lead to rental prices dropping by around a third due to current often Euro-denominated rates being unaffordable for most non-gambling businesses.

While some of the former betting shops have changed business operations, more are expected to close down due to being unable to survive as mere coffee shops without the lucrative sport betting business that allowed them to pay up to €3,000 in monthly rents for downtown Tirana facilities, more than double another non-gambling business could afford paying.

 

A booming industry

Gambling was a completely privately-run industry in Albania where until last year it officially generated more than €130 million in annual income, paid about €50 million in taxes and employed some 7,000 people, but much more if the informal sector was taken into account.

Experts had blamed the booming gambling industry for a series of negative economic and social effects, often associated with higher domestic violence and divorce rates.

The booming gambling businesses was often linked to gangs laundering crime and drug proceeds. There have also been cases when even senior officials and judges have justified some of their income through winnings in betting shops or casinos in their wealth declarations.

The ban on the booming sports betting industry comes following a two-year extension to a law disciplining gambling in downtown areas that was initially scheduled to become effective in January 2017, but became effective this year under new tougher amendments limiting gambling to 5-star hotels and non-residential areas that will be determined by the government.

Prime Minister Rama recently has said the gambling ban is saving Albanians €1 million a day, but hinted of new legal changes that could discipline sports betting following a freeze period.

Albania had an estimated more than 3,900 betting shops at a rate of 1 per 730 local residents until last year, setting a European record.

Gambling was a booming business in Albania during the past decade, defying global crisis effects and the economic slowdown that Albania faced. Gambling operations in the country varied from lotteries, electronic casinos and more numerous sports betting shops.

A gambling law, which has been in force for several years, banned people under 21 from entering betting shops, but regardless, teenagers are often seen there.
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                    [post_date] => 2019-01-25 10:27:51
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                    [post_content] => TIRANA TIMES EDITORIAL

Examining the performance of the chief of the executive and his new cabinet members, by now it is clear that 2019 will be the year spent on designing mechanisms, choosing people and perfecting styles on how to escape and evade any form of responsibility, either legal or political, from the many scandals that marked the end of 2018.

One way to do it is to appoint loyal entrusted employees who take the slack and bear the brunt with ease since they were not elected to do anything.

Lest just take this week’s example. The new minister of Infrastructure and Energy, or as one jokingly could call Lady Guillotine, is having multiple conferences per day to announce resignations and firings of the directors of key departments: the port of Durres, the National Agency of Roads and transportation, the transmission systems operator, etc.

Another form of escaping is the new legislative proposal discovered this week that aims at putting an end to the dubious procedure of allowing businesses to approach the government with unsolicited road projects which are the favored in the respective tender procedures. This so-called end of the Road PPPs, foreseen in July of 2019, with which this government has been in a symbiotic relation of at least 1 billion euros might be surprising but it’s a good tactical move. The legislative proposal has been legitimized with the recommendations form international financial institutions conveniently ignoring the citizens’ pressure against them. But fear not as PPS will be allowed in many other sectors such as energy, air transport and as of yesterday to implement the pact for the university therefore construction of campuses and auditoriums.

And finally the grand gesture of complete disregard of responsibility came in in the ceremony of transfer in the Ministry for Europe and Foreign Affairs. Immediately after former Minister Bushati finished his speech Rama came up to the podium, and said that this would be the shortest speech in his life. He transferred all the power of the Ministry and the duty to represent Albania in the international arena to Gent Cakaj, who was refused blatantly by the President of the Republic for the very same task and who gathered the ire and contempt of experts across the board with the lack of proper credentials. His beaming smile today in his first speech, disturbed by all the storm and yet still defiant to his own real shortcomings, showed that the contempt was well deserved.

This government has by now lost all sense and purpose of the role of an executive as a body that derives legitimacy from the majority vote and which keeps them accountable by their political programme. They move chaotically motivated by the desire to prolong their power life, struck by their own corruption and meddling with crime, struck by the popular discontent and struck a million times by the   infinite greed of the oligarchs they have chosen to serve instead of their constituents.

With all that is going wrong with them one can acknowledge the only merit left: that right now they might be giving some textbook lessons on how to escape their political responsibility.
                    [post_title] => Editorial: Lessons on how to escape political responsibility 
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                    [post_modified] => 2019-01-25 10:27:51
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            [4] => WP_Post Object
                (
                    [ID] => 140267
                    [post_author] => 281
                    [post_date] => 2019-01-25 10:19:29
                    [post_date_gmt] => 2019-01-25 09:19:29
                    [post_content] => TIRANA, Jan. 23 - The Westminster Foundation for Democracy, a UK government agency committed in strengthening democracy around the world, announced the opening of its Albania office on Wednesday in a ceremony held at the Rogner Hotel.

The launch of this event, which the WFD took up under the new, Western Balkan initiative, comes to support the parliament, political parties and civil society in order to improve democracy. 

It will further help build trust in democracy by making parliament more accessible to citizens and civil society organisations and will also support parliament and civil society on initiatives to counter organised crime. 

The ceremony was initiated by the WFD Regional Director for Europe and Central Asia Chris Levick, while speeches were also held by head of the Albanian Parliament Gramoz Ruci and the UK Ambassador to Tirana Duncan Norman.

“Let’s help governors and rulers understand that democracy is not just a list of political, economic, social and religious rights, but their coexistence with constitutional liberalism,” Ruci said during the ceremony. 

It was announced during the ceremony that in the days following the event, the Albanian office will offer cooperation and support for the country’s main actors, in order to address the complex problems which hamper democratic consolidation and European integration. 

WFD has been active in the Western Balkans since the early 2000s, when it led efforts to stabilize the region’s political institutions in the wake of conflict between Serbia and Kosovo. Most recently, WFD focused on developing cross-national cooperation between national parliaments on financial scrutiny and transparency.

Despite efforts to improve governance in the region, support for political institutions, the rule of law, gender equality and post-conflict reconciliation remains critical, as highlighted in a recent House of Lords International Relations Committee Report.

In Kosovo, for example, will focus on developing local political parties while interventions in Macedonia will help tackle mistrust of public institutions, poor quality of legislation and weak scrutiny of public finances.

In Serbia, which hosts the WFD regional office, the programme will work to improve the quality of legislation as well as promoting broader political participation by citizens.

The new programme builds upon a 2015-2018 initiative to promote parliamentary oversight of national budgets and action on transparency as ways to build public trust in democracy across the Balkans. This was instrumental in establishing budget offices in the parliaments of Montenegro and Serbia. These independent bodies provide analysis on national economic performance, government budget proposals and taxation to legislators and the public.

 
                    [post_title] => UK-based WFD launches Tirana office under Western Balkan Initiative 
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            [5] => WP_Post Object
                (
                    [ID] => 140207
                    [post_author] => 29
                    [post_date] => 2019-01-24 17:15:05
                    [post_date_gmt] => 2019-01-24 16:15:05
                    [post_content] => TIRANA, Jan. 24 - Albania is winning over the Kosovo-Serbia trade war, having sharply increased exports to neighboring Kosovo, a natural ethnic Albanian-dominated trading partner, where gains in market share could be even bigger if Albania produced more and current tariff and non-tariff trade barriers were lifted.

Kosovo is partly replacing regional imports from Serbia and Bosnia and Herzegovina with products from Albania and Macedonia following a 100 percent tax it introduced against Serbian and Bosnian imports in late November 2018 in retaliation for their efforts in blocking the recognition of Kosovo’s independence and its membership in key international organizations.

Imports from Turkey, Bulgaria and Croatia also registered a significant boost in the last two months of 2018 as significant imports that Kosovo used to made from Serbia and Bosnia and Herzegovina, its top trading partners for imports, were paralyzed following the 100 percent trade tariff that Kosovo introduced on Serbian and Bosnian imports on Nov. 21, according to Kosovo’s statistical agency.

Kosovo's imports from Albania rose by 50 percent over November-December 2018 after Kosovo initially introduced a 10 percent tax on imports from Serbia, its main trading partner it declared independence from a decade ago, before hiking it to 100 percent on Nov. 21 and even extending it to all international branded goods produced in Serbia and Bosnia and Herzegovina on Dec. 28, defying criticism by EU and US authorities.

The hike makes Albania the top exporter to Kosovo among regional EU aspirant and CEFTA countries, overtaking traditional top exporter Serbia whose exports to Kosovo drastically dropped by almost 90 percent to a mere €5 million last December.

However, keeping the leading position on exports to Kosovo among regional Western Balkan countries will not be as easy for Albania as long as the tax against Serbia and Bosnia and Herzegovina remains in force.

Data by Kosovo's statistical agency shows Albania and Macedonia each exported around €17.4 million of goods to Kosovo last December, with Macedonia holding a slight advantage after Albania led regional exports to Kosovo with €20 million last November, €5 million more compared to Macedonia.

Kosovo also significantly increased imports from Turkey over November-December 2018, ranking Turkey which is experiencing an economic slowdown following a slump of its lira against the US dollar, the second most important partner for exports to Kosovo after Germany.

Detailed data by Albania's statistical agency shows the boost in Albanian exports is mainly a result of a significant hike in oil and minerals and construction material and metals, rather than food and non-alcoholic beverages and furniture whose exports also registered moderate hikes.

Albania's exports to Kosovo rose by around 30 percent to 27 billion lek (€216 mln) in 2018, but imports from Kosovo registered only a modest 5 percent increase to account for only a third of what Kosovo imports from Albania, according to Albania’s INSTAT.

While Kosovo’s unilateral tax has received international criticism because of running against the regional free trade agreement, Kosovo authorities say it’s the only way to stop Serbian agenda against Kosovo’s independence and Euro-Atlantic integration a decade after its independence from Serbia.

Local Kosovo media say the blockade on Serbian imports is having an initial positive effect on local Kosovo producers, some of whom have increased production capacity and employment. However, import of raw material that was traditionally imported from Serbia and Bosnia remains a problem until new competitive suppliers are found.

While Albania will find it almost impossible to replace Serbian grains and flour as well as raw material for Kosovo producers, local experts say Albania can be quite competitive in replacing former Serbian steel and oil products which Albania heavily produces through Turkish and Chinese investors.

However, tariff and non-tariff barriers still in place and poor production capacities by the Albanian economy compared to other regional competitors will likely find the Albanian economy with moderate benefits from Kosovo’s tariff hitting more than €500 million of Serbian and Bosnian products.

Albania’s exports preserved their double-digit growth for the second year in a row in 2018, but last December’s performance hints the country’s poorly diversified exports will find it difficult to preserve their growth rates for 2019 due to energy-related exports having received a blow from a prolonged drought hitting hydro-dependent electricity generation and a new decline in oil prices.

In addition, Europe’s single currency continuing to trade at a 10-year low against the Albanian lek, having lost around 7 percent last year, is expected to increase pressure on the country’s exporters whose profits have been significantly affected by Euro’s free fall.
                    [post_title] => Albania wins over Kosovo-Serbia trade war 
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                    [ID] => 140175
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                    [post_date] => 2019-01-22 14:06:33
                    [post_date_gmt] => 2019-01-22 13:06:33
                    [post_content] => TIRANA, Jan. 22 - After the country’s Socialist government announced it will be cancelling a highway PPP awarded to one of the country’s business  oligarchs to channel more money to public universities in the wake of massive student protests, the opposition raised doubts over the veracity of these claims.

“Today, the government claimed the money fund it would use from the state budget for Thumane-Kashar highway would go to the University fund . The question is, which funds from the state budget were destined for this highway? According to the draft budget, the fund for the construction of the highway in question is 0 Albanian lek and its disbursement starts next year (in 2020). The same figures and facts show that the highway cost is 20 million euros per kilometer, payments that would start in the first day of 2020 and not this year,” Democratic Party lawmaker Jorida Tabaku wrote on Facebook on Monday. 

She further concluded that no additional money can be channeled to the public university funds, calling out the government to be lying.

The cancelled PPP is a €244 million 21-km highway linking Kashar, an industrial area just outside Tirana, to northern Albania Thumane village close to the entry of the Highway of Nation linking Albania to Kosovo, the country’s first toll road since Sept. 2018.

Last July, the Albanian government selected Albanian-owned Gener 2, one of the country’s leading construction companies under a 13-year PPP following an unsolicited proposal that placed the company at an advantage through a bonus in a no-surprise tender with little competition. 

The Albanian government had not concluded contract negotiations with Gener 2 yet, and reportedly suspended them in late December following a PPP scandal allegedly involving the winning bidder.

The PPP cancellation comes after media investigations into an offshore company that had €30 million in government-funded projects cancelled last December after falsifying links to a US-based company in what was dubbed as a major PPP scandal in Albania’s ever increasing use of concessions and PPPs to complete key road, health, education and waste management projects.

DH Albania, the phantom company that had its Albanian contracts cancelled, has been accused of alleged links with Gener 2 and its owner, Albanian businessman Bashkim Ulaj, who in late 2018 also inaugurated with much fanfare a new TV station, Tirana-based A2, which is branded as a CNN exclusive news channel affiliate.

The Voice of America in the local Albanian service also claimed the newly established company was favored by government authorities in receiving required licences and permits to run for the tenders, thus locking horns with the government and Prime Minister Edi Rama.

Instead of cancelling a PPP not scheduled to be refunded during 2019, the opposition proposed the government cancels another allegedly corrupt PPP that will construct incinerators - valued over 34 million euros - if it truly wants to improve public university standards.
                    [post_title] => Opposition: “Gov’t is lying over cancelled PPP funds’ allocation to public universities” 
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                    [ID] => 140159
                    [post_author] => 29
                    [post_date] => 2019-01-21 16:18:34
                    [post_date_gmt] => 2019-01-21 15:18:34
                    [post_content] => By Ervin Lisaku

TIRANA, Jan. 21 – Faced with mounting pressure over a recent public private partnership scandal and student protests over changes and higher financing in Albania’s public higher education system, the Albanian government has cancelled a costly highway PPP awarded to one of the country’s so-called oligarchs, arguing it wants to channel more funding to public universities.

The cancelled PPP is a €244 million 21-km highway linking Kashar, an industrial area just outside Tirana, to northern Albania Thumane village close to the entry of the Highway of Nation linking Albania to Kosovo, the country’s first toll road since Sept. 2018.

Last July, the Albanian government selected Albanian-owned Gener 2, one of the country’s leading construction companies under a 13-year PPP following an unsolicited proposal that placed the company at an advantage through a bonus in a no-surprise tender with little competition. The Albanian government had not concluded contract negotiations with Gener 2 yet, and reportedly suspended them in late December following a PPP scandal allegedly involving the winning bidder.

The PPP cancellation comes after media investigations into an offshore company that had €30 million in government-funded projects cancelled last December after falsifying links to a US-based company in what was dubbed as a major PPP scandal in Albania’s ever increasing use of concessions and PPPs to complete key road, health, education and waste management projects.

DH Albania, the phantom company that had its Albanian contracts cancelled, has been accused of alleged links with Gener 2 and its owner, Albanian businessman Bashkim Ulaj, who in late 2018 also inaugurated with much fanfare a new TV station, Tirana-based A2, which is branded as a CNN exclusive news channel affiliate.

A subsidiary of US-based Dunwell Haberman, DH Albania easily won public tenders to build a section of Tirana's outer ring road for €18 million and an electricity transmission line north of Albania worth around €12 million in the second half of 2018, in public tenders with virtually no competition at all. The Albanian unit falsely claimed it was part of a major US company with 20 years of experience allegedly registered in the state of Delaware in 1998, but later proved to have registered only in mid-2018.

The Voice of America in the local Albanian service claims the newly established company was favored by government authorities in receiving required licences and permits to run for the tenders.

 

Gov’t withdrawal

"I have decided to cancel the Thumane-Kashar public private partnership. Its budget will go to the ‘University Pact’ but to us this continues to remain an important road axis," new Infrastructure Minister Belinda Balluku said in a short press conference on Monday in her first appearance as minister after replacing former minister Damian Gjiknuri few days ago.

Most Albanian public universities have been boycotting classes since early December 2018, paralyzing university life with protests, demanding higher quality and lower tuition fees. Backed by considerable number of professors, students also want a 2015 higher education law cancelled, blaming it for the current chaotic situation in the country’s public universities.

The unstoppable student protests led to a reshuffle of more than half of the ruling Socialist Party government in late 2018 and Prime Minister Edi Rama giving in to some of the students’ demands by reducing fees for Bachelor studies, but keeping them unchanged for the more costly Master’s studies where only excellent student and those in need have been promised a cut.

Student protests in several public universities continue even after the so-called University Pact and calls for dialogue by Prime Minister Edi Rama. University professors in some faculties have also joined protests.

 

Controversial costly PPPs

The €244 million Kashar-Thumane project is part of a major €1 billion controversial PPP program that the Albanian is implementing to upgrade road, education, health infrastructure in a major project that has been criticized for lack of transparency and hidden costs that could likely affect Albania's plans to reduce public debt, currently at an unaffordable 70 percent of the GDP for the size of the Albanian economy.

The segment was part of a proposed larger 64-km Thumane-Rrogozhine highway linking south and southeastern Albania to northern Albania and Kosovo faster.

The government was planning a new 44-km Thumane-Rrogozhine PPP in another costly project worth around €670 million that would take the Kashar-Thumane-Rrogozhine cost to around €900 million, around 7 percent of Albania’s GDP, almost the same to a longer highway linking Albania to Kosovo inaugurated a decade ago.

Gener 2 was supposed to build the project in three years by securing funding on its own and receive taxpayer support for ten years for its investment and maintenance costs in a project that had been criticized for high costs of around €12 mln/km.

The Albania government was supposed to start paying the first 2.45 billion lek (€20 million) annual instalment to Gener 2 in 2020, according to the finance ministry.

The project was described as the second most important in the €1 billion PPP agenda after the Arbri Road linking Albania to Macedonia, already under construction through a 13-year €240 million PPP awarded to another Albanian company.

One of the country’s biggest companies, Gener 2 also runs two shopping centers in Tirana and is engaged in two hydropower plant constructions along the Valbona River, northeast Albania, in a project that has triggered strong protests by environmentalists and local residents relying on the emerging mountain tourism there.

International financial institutions such as the World Bank and the IMF have also voiced concerns about Albania’s PPP agenda especially the transparency related to them and unsolicited proposals favoring companies that propose them as well as possible accumulated arrears which could hamper the debt reduction agenda.

However, the ruling majority argues the PPP projects are essential to give an impetus to the country’s road, health, education and waste management infrastructure in projects which it says the government cannot fund and manage on its own. The government will repay concessionaires for about 13 years in annual instalments for the investment and management costs in return for initial private investment that is expected to complete the projects in three years, in costs that some economy experts have described much higher compared to traditional public procurement.

Taxpayer support to some controversial public private partnerships is expected to increase by around 50 percent to €100 million for 2019 as the government starts paying on three news public private partnerships, taking PPP spending to 3 percent of the previous year’s fiscal revenue, compared to 5 percent threshold that the government has set.
                    [post_title] => Ruling Socialists cancel €244 mln PPP to Albanian ‘oligarch’ over alleged links to offshore scandal 
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                    [post_modified] => 2019-01-23 12:25:19
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                    [post_date] => 2019-01-17 18:50:09
                    [post_date_gmt] => 2019-01-17 17:50:09
                    [post_content] => It is often said that although art is supposed to be ‘life in extrems’, real life very frequently surpasses art in its exotic extremes. One of these times happened this week for Albanians who watched Klement Balili turn himself in to the police after allegedly negotiating with them for quite a few weeks. Klement Balili was nicknamed by Greek media as the ‘Escobar of the Balkans’ and his latest move surely did justice to this designation as it eerily resembled the most famous televised series whose subject was the real Pablo Escobar’s life. He also turned himself in to the authorities after negotiating his way up to a personal luxury prison.

Klement Balili was the  notorious one the ‘most wanted’ list of Albanian law enforcement. The middle aged savvy drug trafficker had upset the political balances of the ruling majority since the first mandate. He was mentioned frequently by high level diplomats, most notably the former American ambassador, who lamented publicly the failure of Albanian police to bring him in so he could face justice.

Truth be told Balili’s first political connections date back to the Socialist Movement for Integration however as every successful drug lord he knew better than remain limited just to one access point to power. His beaming face figures in many photos next to Albanian politicians who were very keen to visit his splendid Saranda resort. Apart from anecdotal evidence, nothing else but political connections and corruptive links to police and justice explain his success of escaping numerous operations for his capture without ever leaving the territory of Albania. That and a strong dose of popular support in his home area of Delvina where he is rumored to be something of a charity man. Exactly like Escobar.

The attempts of the Interior Minister and State Police to call his turning in a success for police operations caused some good laughs among citizens who were quick to fill up social media with memes and jokes. Indeed how can you call a success the fact that the most wanted drug trafficker hides in plain sight for years and then negotiates his own capture with the very Director of the State Police and walks in the police offices after saluting his family? Among those that get a final greeting, the mayor of Delvina who just happens to be the next prisoner’s nephew.

It is starting to painfully resemble the movies and the series a bit more and more every day. Every detail, every move, every calculated timing and even the style of the media coverage. The most troubling legacy of narco-influence in politics is starting to be normalized, mainstreamed, televised and slowly accepted as a sad fact but a fact nevertheless. The show is now open for all those interested to see.

The international community was quick to laude this ‘achievement’. The fact that this development happened parallel to the visit of the foreign ministers of Italy and the Netherlands, two countries which rank the first as a supporter and the second as a skeptic of EU enlargement, also was very convenient. However most of the questions that surrounded Balili’s activities, connections and criminal network remain as pertinent as ever. His lawyers team has on board former attorney generals and others who are confident of the lack of incriminating evidence.

Albanian citizens-turned-spectators would not be surprised if Balili walks free. It happens so often in these kind of movies. And as we said, real life does not lag behind with these guys.
                    [post_title] => 'Escobar of the Balkans'  and the destructive legacy of narco-influence in politics
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                    [post_date] => 2019-01-17 18:46:02
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                    [post_content] => TIRANA TIMES EDITORIAL

Seeing that the President of the Republic, Ilir Meta, did not bulge from his decision to reject the proposed name of Gent Cakaj as a Foreign Minister, Prime Minister Rama designated himself as an acting Foreign Minister. This as he says until a new Constitutional Court can strike Meta’s decision down. Rama, just like few predecessors, and most notably like the communist dictator Hoxha, now carries both tasks.

Yet Rama has the most legitimacy out of all the new cabinet members, most of whom are technical figures, half of them unknown to the public and the other half known for, let’s say, not the right reasons. A quick scan of them points out several issues that are problematic: the new Minister of Education has the same problems that derive from not being grounded genuinely in the social and political life of Albania as well as from the fact that the student protests are far from resolved. Besa Shahini from Kosovo has been giving many press conferences lately, yet no one seems to hear her. She is not fit to lead the Education Ministry, at least at this stage, and it is unfair also to her to carry the weight of the failed Law on Higher Education, a weight of a political party that she does not belong to.

The new minister who will take charge of the supernova Ministry of Infrastructure and Transportation, with its gargantuan budget and power over key contracts is on the other side a bit more grounded that necessary in the heart of unresolved political and even other issues in Albania. Having led first the communications team during Rama’s time as a mayor and then AlbControl, the national traffic agency, which manages the airspace, Belinda Balluku has been at the heart of media storm about investigations about air radars. Most recently media reported that she threw a lavish end of year party for her company at the most expensive hotel in Tirana, involving exotic dancers. That’s quite some style coming in for the Ministry. Balluku is outspoken, aggressive and loyal to Rama. She will stand in to face the remaining brunt of the scandal of the tender procedure for the Ring Road of Tirana yet she is also a nonpolitical figure which has no responsibility over the voters’ trust.

The new Minister of Culture, Elva Margariti, will be another Rama advisor formerly engaged with the project of the ‘100 touristic villages’ and known for just a few media appearances  that supported the decision to destroy the building of the National Theater. Another name of political anonymity, executive loyalty and readiness to face remnant scandals and conflicts with the right lack of political legitimacy and gravitas.

These are the members of the caretaker government that is taking over this year. Caretaker governments are in fact limited in their scope and powers by both custom and convention. However this specific one designed by Rama and serving the unique purpose of elongating his political life, now in shambles, will not fit this description. This caretaker government, especially in the context of a judicial system in disarray, is designed to have unchecked executive powers. Whereas caretaker governments are provisional, leading and preparing towards something decisive, a next stage, this particular one has one sole objective package: preserve the status quo, evade responsibility, divert attention, secure power.

This caretaker government of de-facto one person, the Prime Minister, is yet another example of a government that lingers while its system of governance has shattered.
                    [post_title] => Editorial: A caretaker government of one
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            [post_date] => 2019-01-30 12:29:17
            [post_date_gmt] => 2019-01-30 11:29:17
            [post_content] => By Ervin Lisaku

TIRANA, Jan. 30 – Failure to settle amicably a tax dispute on the under-construction National Arena stadium, the new home of Albania’s national side in the Albanian capital city Tirana, has taken Albania’s football association and the government to court where football officials are seeking back €2 million in value added tax refunds.

Albania’s football association says failure to get back €2 million in VAT refunds from UEFA funding of €10 million risks the completion of the National Arena stadium. The so called ‘tower stadium’ was initially scheduled to become operational in early 2019 ahead of Albania’s first Euro 2020 qualifiers in March, but delays in construction works and a tax dispute have now postponed plans for initial tests to mid-2019 and the stadium is likely to be ready for next September or November when Albania play their closing home Euro qualifiers against Iceland, Andorra and France.

The legal battle at the first instance Tirana Administrative Court comes after a tax appeals body of the finance ministry turned down a complaint over VAT refunds due to delays in applying with tax authorities to get back the 20 percent amount.

Both the Albanian football association and the government are joint venture partners in the enterprise set up in 2014 to oversee the construction of the new stadium in the country.

The majority 75 percent stake at the “Qendra Sportive Kuq e Zi’ company [The Red and Black sports center named after Albania’s national side jersey] is held by the football association with the remaining 25 percent minority stake held by the Albanian government.

"We were told by tax authorities that our [VAT refund] application was delayed for several days, but I don't think this is the case to cancel it. We appealed it with the finance ministry and it was again refused,” Football Association President Armand Duka said in a TV interview in late December 2018.

“I have talked to the Prime Minister and from the conversation I had with him, he is between two fires. The football association has obtained 100 percent of the stadium funds from UEFA and there can be no such financing where state authorities seek to take advantage of UEFA donations," he added.

According to Duka, last December’s visit to Albania by UEFA’s Secretary General Theodore Theodoridis, who also reportedly met Prime Minister Edi Rama, was also related to the tax dispute over funds donated by the European football’s governing body.

In an announcement on its website, the Tirana Administrative Court says the football association is seeking the cancellation of decisions by the Tirana Regional Directorate and the tax appeals body at the finance ministry and the initial trial was planned for Jan. 22, 2019.

However, unless settled amicably, the legal battle in Albania's three-tier administrative court system could take years due to a huge backlog of cases at the Administrative Appeals Court and the Administrative College of the Supreme Court, currently both functioning with limited staff due to a judiciary reform having ousted several judges for failing to justify their assets and delays in the establishment of the new justice bodies leading to key vacancies.

With construction works already in their final stage following the mid-2016 demolition of the old “Qemal Stafa” stadium, the football association has earlier warned failure to get back the €2 million tax refund would call the stadium completion into question.

The football association has hinted of politically motivated reasons behind the blockage, apparently related to incumbent football association head Armand Duka claiming a fifth consecutive term of office in early 2018 in a contested race by main rival Bashkim Fino, a former Prime Minister and current ruling Socialist Party MP.

 

New ‘tower’ stadium

The new ‘National Arena’ stadium is a €50 million public private partnership deal with a capacity of 22,000 seats that will also feature commercial, entertainment and accommodation facilities in a high-rise tower next to it. The Albanian football association has invested €10 million through UEFA funding.

An Albanian-owned company has invested €40 million to build the stadium in return for being offered public land and a permit to build a 24-storey tower next to it that will host commercial facilities, including a hotel that will be managed by US-based hotel giant Marriott International through a franchise deal with the developers, benefiting tax cuts as a high-end tourism investment in a popular downtown Tirana area.

The new National Arena stadium is being built on the site of former ‘Qemal Stafa’ stadium in Tirana, which ceased being used for international matches in 2013 after failing to meet international standards. Unlike the old stadium, the new facility has no athletics track, a key barrier for some of Albania’s athletes like Luiza Gega, a medal-winning middle-distance runner.

Former ‘Qemal Stafa’ stadium served as Albania’s national stadium for over 70 years since 1946 when it was inaugurated for the Balkan Cup as an Italian-designed facility.

Lacking a permanent home, the Albanian national football team has in the past five years played their home matches at the newly reconstructed Elbasan Arena and Shkodra stadiums, both reconstructed through government funding of around €14 million.

The Albanian football association which has invested around €10 million in the stadium project through UEFA funds will also get considerable facilities, but not have its headquarters there. The new football association headquarters that will also serve as an accommodation center for the national side are already being built elsewhere in Tirana at a former sports complex.

Albania will start their Euro 2020 qualifiers on March 22, 2019 with a home encounter against Turkey, a much more experienced national side, but who have been struggling to qualify for major tournaments during the past decade following a golden period in the 2000s.

Having missed a chance to keep qualifying hopes alive through the inaugural UEFA Nations League by finishing bottom in their League C, Group 1, and having also lost much of their Euro 2016 qualifying campaign shine during the past couple of years, Albania will be trying for another miracle qualification in a tough group stage where France are undisputed favorites for a top finish and Iceland, Turkey and Albania will rival for a second spot that also earns direct qualification for the Euro 2020 finals.
            [post_title] => Albanian football association in legal battle with gov’t over 'denied' UEFA tax refunds 
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