Albania eyes closer ties with China as major projects discussed

Prime Minister Rama visits Beijing to discuss major infrastructure projects, as China progresses toward second top trade partner for Albania.
TIRANA, Sept. 10 – Seeking to complete a number of important infrastructure projects and attract further international investments, Albania is eying closer cooperation with China as Prime Minister Edi Rama held an official visit to Beijing, accompanied by his economy and energy ministers.
Besides meeting with his Chinese counterpart, Premier Li Keqiang, and other senior officials and potential investors, Rama also took part at a Davos World Economic Forum event held in China.
Tirana is aiming to attract more investments from the world’s second largest economy, officials say, hoping to bank on historic ties with China, which once was a close ally during the former communist regime. After falling out with the then-Soviet Union in 1961, Tirana turned to close cooperation with Beijing that offered its financial and military support until 1978.
Albanian officials also tried to seek help in getting Kosovo’s independence recognized by China, a move that had a rival bid through Serb Prime Minister Aleksandar Vucic, who was visiting China at the same time. Rama and Vucic met on the sidelines of the conference, according to media reports.
Economic cooperation seen as key
Having emerged as Albania’s third most important trade partner and almost overtaking Greece as the second top partner, China has reconfirmed its interest of strengthening economic cooperation with Albania especially in the agriculture and infrastructure sectors.
China vowed closer cooperation with Albania as Chinese Premier Li Keqiang discussed plans to construct a highway linking Albania and Macedonia with Albanian Prime Minister Edi Rama this week, reported Xinhua, the Chinese state news agency. Li made the pledge during a meeting with Rama on the sidelines of the Summer Davos in north China’s Tianjin city.
Hailing the traditional friendship with Albania, Li said the two countries should use the 65th anniversary of their diplomatic relations as an opportunity to improve high-level exchanges and promote practical cooperation in all fields. He said China and Albania complement each other economically and have good prospects for energy, agriculture and infrastructure cooperation. China is willing to import more specialty agricultural and mining products from Albania and support Chinese enterprises as they engage in infrastructure development in Albania.
“China and Albania will work to make breakthroughs on large projects by promoting the construction of the highway linking Albania and Macedonia in particular,” Li was quoted as saying.
Albania’s Prime Minister Edi Rama said both countries have enjoyed sound relations, voicing willingness to deepen traditional friendship and expand cooperation with China. He welcomed investment from more Chinese entrepreneurs in Albania, saying the country would help facilitate such transactions.
Rama said cooperation between China and Central and Eastern European countries have achieved positive outcomes and called for mutual efforts to bring peace and development in Central and Eastern Europe.
Shengjin port concession
Kosovo media reported the Albanian government is negotiating with China over a concession in the Shengjin port, which had been continuously promised to landlocked neighboring Kosovo since 2009, one year after it declared its independence.
The Shengjin Port, Albania’s second biggest port for handling goods, is having its basin deepened under a USD 1.5 million investment by the Albanian government, says the Transport Ministry. The project expected to complete by 2015 will increase the port’s handling capacity to 1 million tonnes, up from around 300,000 tonnes of goods currently and allow anchoring of ships with a capacity of up 6,000 tonnes.
The Albanian government also plans to build a new port in Shengjin, northern Albania, that will also serve to neighboring Kosovo and Macedonia for their trade exchanges.
Data published by the Institute of Transport shows the volume of goods handled in Shengjin Port in 2013 dropped to 273,172 tonnes, down from around 342,000 tonnes in 2012, registering the lowest level in the past five years.
Since 2011 the Shengjin Port has not been handling passengers. The Shengjin port is about 90 kilometres north of capital Tirana and about 100 kilometres west of Kosovo.
Cooperation potential
The Arber Highway (Rruga Arberit) linking Albania to Macedonia, the Adriatic-Ionian Highway in the Western Balkan, the Shengjin Port, railway, energy, agriculture and fish farming are some of the opportunities Chinese investors will find in Albania.
“Albania is a tiny Balkan country but has signed the Central European Free Trade Agreement (CEFTA) which accounts for 26 million consumers,” said Economic Development and Entrepreneurship Minister Ahmetaj last June at a ministerial conference with Central and South Eastern European countries held in China’s Ningbo.
“This is very favorable time for trade and investments and we are seeking closer cooperation with powerful companies which could help bring the Albanian economy to another stage, that of the European Union and its markets,” said Ahmetaj in a meeting with his Chinese counterpart Gao Hucheng. He urged Chinese companies to consider Albania as a hub to the regional market because of its favorable geographic position.
Trade exchanges and investments from China have seen an increase in the past few years.
A consortium led by China’s biggest copper producer has recently bought a 50 percent stake in Turkey’s Nesko Metal Sanayi ve Ticaret Albanian mining operations for $65 million, registering the biggest Chinese investment in Albania. Jiangxi Copper will own a 48 percent stake in Nesko while two other Chinese companies have a 2 percent share.
The central banks of Albania and China have also signed currency swap deal worth around 250 million euros. The swap transaction provides a channel by which the central banks can have access to the local currency of the other party. It aims to promote bilateral trade and direct investments for economic development of the two countries in local currency terms, and to support domestic financial stability of both countries, if market conditions require such liquidity.
Albania-China business community is also now represented by a Chamber of Commerce and Industry.
China is one of Albania’s top trade partners with trade exchanges on a constant upward trend.
Albania’s trade exchanges with China registered a considerable increase in 2013, ranking China the third most important trade partner after Italy and Greece. INSTAT data show Albania’s exports to China double to 11.5 billion lek (Euro 80 million) in 2013 while imports slightly grew to 35 billion lek (Euro 244 million).