TIRANA, Nov 8 – Albania lost one place in the Doing Business 2011 report published by the World Bank last week ranking 82nd, down from 81st last year. The report comparing business regulations in 183 economies sandwiched Albania between Jamaica and Pakistan.
Albania’s neighbours Macedonia ranked 38th, Montenegro 66th while main trade partners Italy and Greece 80th and 109th respectively. Likewise Albania, Kosovo also lost place ranking 119th in the 183 country-list. Bosnia and Herzegovina which has recently been granted visa-free travel in the Schengen area along with Albania ranked 110th.
“Albania made it easier and less costly for companies to pay taxes by amending several laws, reducing social security contributions and introducing electronic filing and payment,” said the report.
Albania’s best performance was reported in the “getting credit” category ranking 15th because of an almost top score in the strength of legal rights index. The country also ranked 15th in protecting investors. Under a law approved by majority members of the Parliament last September, foreign investors have been granted full legal protection in Albania even in cases of possible land disputes which will be handled by state authorities.
Albania’s third best indicator in the report was starting a business in which the country ranked 45th especially because of the short time it takes, five days and few procedures which are carried out at the National Registration Center, a one-stop-shop facility.
Albania ranked the world’s 72nd in “Registering property” with 42 days, 6 procedures and a 3.4 percent cost of the property value needed to complete the process.
Trading across border ranked 75th mainly because of the long time needed at customs points, 19 days for exports and 18 to import.
Enforcing contracts remains problematic especially because of the big number of procedures, days needed, more than one year, and high costs of claims which place Albania 89th.
The country’s poorest performance was in paying taxes, the world’s 149th, dealing with construction permits 170th and closing a business at the bottom of the 183-country table because of no practice in this service. Albania’s total tax rate was at 40.6 percent of the profit. The poor performance in the “construction permits” category was a result of the 24 procedures and almost one year, 331 needed to get a permit. This has also been identified as a problem by construction companies whose activity during the first half of this year has considerably shrunk, affecting the country’s economic recovery.
Doing Business 2011 was the eighth in a series of annual reports investigating the regulations that enhance business activity and those that constrain it. The report presents quantitative indicators on business regulations and the protection of property rights that can be compared across 183 economies.
Regulations affecting 11 areas of the life of a business are covered such as starting a business, dealing with construction permits, registering property, getting credit, protecting investors, paying taxes, trading across borders, enforcing contracts, closing a business, getting electricity and employing workers. The getting electricity and employing workers data are not included in the ranking on the ease of doing business in Doing Business 2011.
Data in Doing Business 2011 are current as of June 1, 2010. The indicators are used to analyze economic outcomes and identify what reforms have worked, where and why.
Global competitiveness report
Albania climbed eight places to 88th in this year’s global competitiveness report issued by the World Economic Forum in Beijing last September The report covering 139 countries sandwiched Albania between Argentina and Ukraine which ranked 87th and 89th respectively. Albania total score was 3.95 out of a maximum of 7.
Albania’s most problematic factors for doing business were access to financing, corruption, tax regulations, inefficient government bureaucracy and policy instability.
The most problematic areas in the first pillar, (the Institutions), were property rights in which Albania listed the world’s 116th, intellectual property protection 101st, judicial independence 88th and strength of auditing and reporting standards 83rd.
Albania was placed 15th on the strength of investor protection and 20th on the burden of government regulation.
Infrastructure also remains problematic with its overall quality ranking the country 78th. The quality of roads is ranked 81st while railroad and port infrastructure 109th and 100th, respectively. Albania received poor ranking also in the macroeconomic environment with government budget balance and national savings rate ranking the world’s 109th and 106th respectively.
Government debt which is currently at 59.5 percent of the GDP ranked 92nd.
As far as the goods and market efficiency is concerned, Albania’s poorest performance was in the ‘intensity of local competition’ 113th, and effectiveness of anti-monopoly policy 109th. The country’s best performance in this category was the time required to start a business and the number of procedures required, the world’s 9th and 23rd respectively.
The brain drain was the poorest indicator in the labour market efficiency ranking 107th. Female participation in labour force ranked 87th. As far as financial market development is concerned, their availability ranked 128th while their affordability 113th.
The ease of access to loans ranked 90th while the soundness of banks 107th. The regulation of security exchanges listed 131. The availability of latest technologies was ranked 90th while the number of internet users 55th.
