TIRANA, March 4 – The American Chamber of Commerce in Albania says Albania should follow neighboring North Macedonia’s example in settling its long-standing issue of unclear property titles and stop political and media attacks on current US investors in the country.
The remarks are made by Mark Crawford, the outgoing President of the AmCham, in a comment published on the latest issue of Advantage, the official magazine of the American Chamber of Commerce in Albania.
“The first item that Albania has yet to complete is the availability of a free online map of the country, land registration and related ownership via e-Albania in conjunction with the Immovable Property Registration Office. Clear land ownership is the basis for economic activity – full stop,” says Crawford, an American investor in Albania, who wrapped up his third and final two-year term as President of the Board of the American Chamber of Commerce in Albania.
“The Albanian-American Diaspora has been clear and consistent, stating that the lack of online access to land registration data depresses investor appetite. Such a map is achievable (as evidenced by Northern Macedonia’s online land registry map and helpful for both foreign and domestic investors,” he adds.
Unclear property titles is one of the key barriers to attracting foreign direct investment in Albania, where more than half of the country’s immovable property has ownership problems, in a situation that has severe consequences for the property owners themselves, but also the country’s business climate.
The complicated property issue is a result of a controversial agrarian reform in the early 1990s following the collapse of the communist regime and subsequent non-transparent privatization of state-run property as well as dozens of thousands of illegal constructions built either on private or state-run land during the past 27 years, a considerable part of which already legalized and registered with real estate registration offices.
The Albanian Parliament has already approved legal changes that target providing a final solution to the problem but due to complicated issues related to mistakes and abuses in initial land distribution certificates in the early 1990s, lack of accurate maps leading to overlapping, field verification and the establishment of an electronic register authorities estimate that could take a decade.
Taking care of investors
Mark Crawford says Albanian politicians and media should be more careful in taking care of existing American investors whom he describes as the best advertisement both for, and against, future investment.
His comments come following political and media attacks against a commercial bank with American capital and vandalism against a US-owned telecom company operating in the country.
“I would have the government majority and opposition both make a conscious effort to take care of existing foreign investors. I have seen a systematic schizophrenia between political players trying to attract investors, then pushing them out (often leading to public arbitration suits) or even vilifying them in the media,” says Crawford.
“American investors are often keen to follow success, therefore when a company like ABCom, owned by the SEAF investment fund in Washington DC, complains about malicious vandalism in 2018, it is noticed by American investors. When various political figures attempt to vilify the largest American investor in Albania, namely NCH capital from New York, or their projects such as the American Bank of Investments, then it appears bizarre and anti-American investment,” he adds.
According to him, investment vehicles in tax neutral countries or states, such as offered by Delaware, Holland, or other off-shore entities are commonly used by US investors to aggregate funds in a tax neutral manner, and as such are not of particular concern for Albania insofar as US investors in Albania are often subject to oversight by the U.S. Securities and Exchange Commission.
US investment in Albania has increased during the past year after a US-Albanian-owned bank acquired a Greek bank unit through a merger and a private hospital with American capital purchased its main rival, increasing market shares in the banking and the private healthcare sectors.
Official US investment in Albania reported by Albania’s central bank was at €89 million at the end of 2018, but the investment value is estimated much larger due to US investment often flowing through tax neutral or offshore countries.
Yet, the outgoing AmCham president says that Albania has made some good progress over the last few years and is optimistic that with “decreasing Eurobond interest rates, foreign investors should take note that Albania, in spite of its challenges, is moving forward.”
“Building upon that by establishing transparency of land ownership rights, taking care of existing investors and being present to attract investment funds, Albania can take further and faster steps forward,” he adds.
A higher tax burden compared to other regional countries applying lower rates, red tape, limited competition and difficulty in finding qualified staff are some of the top concerns for foreign and Albanian businesses represented by the American Chamber of Commerce in Albania, according to a 2018 AmCham survey.
