Eurochambres: Corruption is poison for investors to Albania, region
Story Highlights
- “If there is no law enforcement, there is no legal basis on investment, property and European investors don't come. They seek security for their investment. Corruption is poison and whoever gets poisoned once, no longer comes,” says Christoph Leitl, an Austrian politician who is the President of Eurochambres, the Association of European Chambers of Commerce and Industry
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TIRANA, Sept. 19 – European business representatives say Albania has to tackle corruption and strengthen rule of law in order to be more attractive to foreign investors and attract much-needed investment and know-how that creates new jobs and bridges the gap with EU members.
Christoph Leitl, an Austrian politician who is the President of Eurochambres, the Association of European Chambers of Commerce and Industry, says corruption in Albania and the Western Balkans is like poison for current and potential investors.
“If there is no law enforcement, there is no legal basis on investment, property and European investors don't come. They seek security for their investment. Corruption is poison and whoever gets poisoned once, no longer comes,” Leitl, tells Deutsche Welle in the local Albanian service.
Leitl, who visited Albania last week to attend a regional workshop on the digital transformation of SME, spoke to journalist Ani Ruci of Deutche Welle on the challenges facing Albania and the region on their road to European integration and economic progress.
Corruption and an inefficient judiciary are two of the top concerns for foreign investors to Albania, according to surveys.
Albania has been the region’s second largest FDI recipient in the past eight years attracting an average of €1 billion a year, but much of the investment has been in low value added energy products such as oil and minerals, the majority of which is exported as raw material.
FDI concern has recently grown as TAP and Devoll Hydropower, the two major energy-related projects that led FDI growth in the past four years, are set to complete their investment stage by the end of this year and no major project replaces them.
Below is the full interview Christoph Leitl had with Deutsche Welle in the local Albanian service as translated from Albanian:
What was the goal of your visit to Tirana?
-Albania is part of our European economic family, the same way to the five Western Balkan countries with their respective chambers of commerce and industry. I am in Tirana, because Western Balkan countries need to have more European perspective. On the other hand, the EU expects facts and not promises from those countries, especially in two directions; law enforcement and the fight against corruption.
As president of the European Chambers I can ascertain that commercial relations among the six Western Balkan countries have not developed in the past decade. How can you enter the European market at a time when you are not able to have good trade relations in your region? Cooperation among Western Balkan countries has to strengthen. "Together" is one of the key words I always stress.
How would you explain relations between the EU and the Western Balkans from the business point of view?
-There is a lot of sympathy and respect for what this region has managed to handle on its own. The EU can and should help the Western Balkans. Its members, including Albania, participate in several EU pre-accession programs. That strengthens the link between the Western Balkans and the EU. I am critical of Albania in one respect: the main parties and chambers of commerce have to cooperate. When together, you can achieve a lot in Albania and convince the EU that you are ready for accession. If you engage in internal fighting, that will cost you a lot of resources, motivation and question marks will surround Albania's acceptance abroad.
What are the main complaints by EuroChambres members when seeking to invest in Albania or the Western Balkans in general?
- Lack of rule of law and corruption. If there is no law enforcement, there is no legal basis on investment, property and European investors don't come. They seek security for their investment. Corruption is poison and whoever gets poisoned once, no longer comes.
Looking at the Western Balkan member countries. Is 2025 a realistic date or could Western Balkan countries have to wait beyond this timeline?
- There won't be joint accession for Western Balkan countries. Each country will have to fulfil the negotiation chapters on their own and meet EU expectations. For example, Albania is doing a lot to adopt its legislation with the EU. But that does not mean that the legal changes will automatically change the reality. Corruption is never something formal.
Western Balkan leaders stress that if the European perspective is further delayed, then there is a risk that other stakeholders such as Russia, China or Turkey could increase their presence and offers in a region with vulnerable stability and weak economy such as the Western Balkans. To what extent is this danger real from the EuroChambres viewpoint?
- As president of the Global Platform of Chambers of Commerce and Industry, I am aware about what's happening around. Russia is important in the Balkans. The US also has interests in the region. The European economy is open. We expect the same openness by others. We want fair rules and competition. There is no problem if other investors come to the region. We should know that Europe is our identity. We have a joint European interest in the region.
What should the Western Balkans Regional Economic Area, a key product of the Berlin Process, do in order to strengthen, generate new jobs and improve living conditions for the region's residents?
- More confidence at all levels, be it at municipal, regional or state level. Those three levels are not interconnected and cooperative with each other. Investors seek confidence and security.
Vocational training education, transfer of knowledge and skills are a priority for EuroChambres. Youth in Albania and in the Western Balkans in general even when having already obtained vocational education training target migrating to Germany, Austria, the US, Canada etc. What do you think of this phenomenon?
- They migrate because they are paid two to three times higher and have better life prospects. In order for the younger generation not to migrate, they need to have that perspective in their home countries. The younger generation should have a life prospect, leave and come back. That means planning their return. In fact youth in the region are losing their patience. In 2025, the European perspective could be further delayed.
Is there a risk that the May 2019 European elections could have a negative effect on the Western Balkans enlargement policy?
- Yes, there is. If populist, neo-nationalist and separatist forces at the European Parliament win, the EU's WB enlargement project is placed at risk. New EU members will need much more solidarity, help and support. If there is no political will to handle that, then the European project is in a really tough situation. The European project should not be abandoned, the European identity is now needed more than ever.
