TIRANA, Feb. 1 – With tourism on top of the agenda as one of the emerging drivers of economic growth, Albania has been actively promoting its coastal, mountain and cultural heritage tourism in a bid to become a year-round destination to compensate for construction and remittances-fuelled growth in the pre-crisis years.
Prestigious international media outlets have placed Albania as a top undiscovered global destination as the “Albania, go your own way” branding campaign led by U.S.-based APCO Worldwide and its StrawberryFrog ad unit has entered its second year of promoting Albanian tourism.
Prime Minister Edi Rama has described tourism as new opportunity to promote growth, employment and investments.
“We are all aware that tourism is one of the real sources of economic growth and for us it is one of those sources serving as a basis for the development of our new economic model, a sustainable growth with economic growth, employment, social and regional cohesion and in sustainable equilibrium with the environment and natural and cultural heritage,” Prime Minister Edi Rama has said.
“Last year was encouraging for tourism both quantitatively and qualitatively. What we are especially interested in is that there was a considerably geographical expansion in the map where tourists came from and there was a rising number of tourists from Sweden, Norway, Poland, the Czech Republic, Austria and Germany, with the whole of Northern Europe showing increased interest in Albania’s coastline. A considerably number of tourists from Russia and Russian-speaking countries visited the country following the visa free travel regime to Albania for a series of countries,” added the Prime Minister.
The opening of the Sazan Island, a former military base some 20 kilometers from the coastal town of Vlora, to local and foreign tourists for the first time in 70 years, and a Cold War secret bunker outside Tirana that the former communist regime had built underground decades ago to survive a possible nuclear attack, also attracted a lot of interest among international media and visitors.
In late 2015, prestigious French newspaper Le Figaro placed Albania as one of the top five global destinations for 2016. Featuring a picture of the ancient Rozafa castle in the northern city of Shkodra, Le Fiagaro said Albania will surprise everybody just like it did with its first-ever qualification in a major football competition such as France 2016.
The Balkan country has recently also been recommended by Yahoo Travel, several blogs and promoted its destinations by participating in the Vienna and Madrid tourism fairs. Hollywood actress of Albanian origin Eliza Dushku has also released her completed “Dear Albania” documentary featuring her journey in 15 Albanian towns, including Kosovo’s capital Prishtina and Macedonia’s Tetovo as a promotional guide of tradition, beliefs and Albanian tourism.
Albania offers a miscellaneous picture of coastal and mountain tourism and has been attracting more and more foreign tourists in the past few years being nicknamed as “A New Mediterranean Love” and “Europe’s Last Secret”
In January 2014, The New York Times ranked Albania as one of the top four global destinations to go to for 2014, placing the Balkan country as the single European destination on top of the list. The prestigious daily newspaper ranked the Albanian coast as the number four destination to visit, describing it as Europe at its best on a rugged shore and noting that “the Maryland-sized country combines the rugged beauty of Croatia with undiscovered ruins of Turkey or Greece.”
The rating by New York Times came after Lonely Planet tourist guide ranked Albania as the top destination for 2011 and the country was placed sixth in CNN’s top 10 destinations for 2011.
Back in 2012, the Globe and Mail, Canada’s largest national newspaper, selected Albania as a top tourism destination in 2012. In a travel slideshow on its website, the newspaper placed the Albanian Riviera as the top destination among the six best places to visit in 2012.
Albania registered a 20 percent increase in the number of foreign tourists who visited the country during the peak tourist season in the third quarter of 2015.
Data published by the country’s state statistical institute, INSTAT, shows Albania was visited by 1.25 million tourists in the third quarter of 2015, up from slightly more than 1 million foreign visitors during the same period in 2014.
Tourism revenue registered a record high of €1.2 billion in 2014 when more than 3.6 million foreign tourists visited Albania, according to data published by the central bank and INSTAT.
Ethnic Albanians from Kosovo, Macedonia, Montenegro account for three-fifths of foreign tourists visiting Albania, with local experts often referring to this market as ‘patriotic tourism.’
The travel and tourism industry, which employs around 41,000 people in Albania, is estimated to have contributed by $639 million or around 4.8 percent of the GDP in 2014.
Competiveness, investments remain an issue
The unplanned construction boom in several key destinations locally known as “urban massacre,” the high tax burden and failure to attract investment from prestigious foreign companies make the Albanian tourism industry less competitive compared to regional competitors, experts say.
Albania’s tourism industry strongly opposed the 2016 fiscal package as increasing the tax burden and making it less competitive. The travel and tourism industry, which employs around 41,000 people and accounts for 5 percent of the GDP, says the new fiscal package not only failed to reduce the 20 percent value added tax, but also increased the tax burden on most hotels by imposing a fixed accommodation rate of 1 Euro.
“We are concerned because of the fact that VAT is not being revised and the local government tax will double for some hotels, causing a new concern for the tourism industry,” said Enver Mehmeti, the head of the Albanian Tourism Association.
Both the prime minister and the tourism minister have repeatedly promised to revise VAT on tourism in the past six months, the association said.
Revising the value added tax on tourism, currently at 20 percent and at the same level compared to all other goods and services, has been a perennial request by the country’s tourism industry. Operators say the high VAT rate is damaging the competitiveness of the country’s most promising industry considering that regional competitors apply differentiated VAT rates of 5 to 8 percent.
Albania’s tourism competitiveness lost considerable ground in the past couple of years on deteriorating travel and tourism policy and enabling conditions. The Adriatic country ranked 106th out of 141 countries in the 2015 Travel & Competitiveness Index, losing 29 places compared to the 2013 report.
Back in 2015, strategic investors in Albania’s tourism sector were offered state-owned property for a symbolic 1 Euro under 99-year concession contracts to develop tourist resorts.
Experts consider the new law a good opportunity to attract strategic foreign investors considering the chaotic development of tourism and urban massacres in the past two decades in the key tourist destinations and that a considerable part of the Albania’s coastline remains virgin.
However, the long-standing land and property disputes remain an issue to attract new investment.
Back in 2009, France’s Club Med withdrew from a major holiday resort project in Albania’s southern Ionian coast under a similar deal after continuous land disputes with local inhabitants despite a court ruling in favor of the investor’s 99-year concession deal with the Albania government, unveiling the long-standing issue of clear property titles which is often one of the key barriers to foreign investors in Albania.
Bank of Albania data shows the foreign investment stock in hotels and restaurants dropped to 60 million euros in 2014, down from 94 million euros in 2008 just before the onset of the global financial crisis.
