From Isolation to Innovation: Expanding Albania’s credit and productive sectors

TIRANA, March 26 – Establishing a robust private sector is one of the keys to developing Albania’s economy and placing it on a path toward sustainable growth. Toward this end, in 2002 the United States Agency for International Development (USAID) launched the Small Business Credit Assistance (SBCA) project, to increase the competitiveness and productivity of Albania’s private sector. The SBCA project ended in February 2007, but assistance to small and medium enterprises continues as part of USAID’s overall assistance program that encourages economic growth, strengthens democracy and governance, and supports investments in the people of Albania.
Through the SBCA project, thousands of small and medium enterprises across Albania, particularly those in the agricultural and productive sectors, gained much-needed access to credit and received expert advice from marketing and management specialists to increase the growth and strength of their businesses.
The project was designed in two phases. For the first two years, SBCA business development specialists and their local development partners covered the countryبelping businesses apply for loans and providing the training and technical assistance they needed to best use their new credit. In Phase I of the project, more than 4,000 businesses received assistance. Through its partnerships with Albania’s National Commercial Bank (BKT), and Albanian Partners in Microcredit (PSHM), a local microcredit organization, USAID injected more than $3 million into Albania’s financial system during SBCA’s five-year tenure. Moreover, approximately 99 percent of SBCA-financed loans have been repaid, enabling the initial lending capital to be recycled more than five times to new borrowers, thereby maximizing its impact. SBCA business development specialists worked with several companies to improve the management and marketing skills of enterprise operators and analyze the costs and benefits of introducing the latest technologies to their operations. With marketing assistance from USAID and local business service providers, Artflex mattresses are now reaching a broader market. By improving their catalogue, designing a new logo, creating a website, and writing a business and marketing plan, Artflex is improving its image among potential domestic and foreign customers.