Anticompetitive practices, tax rates, corruption, electricity and contract violations by customers and suppliers are the main obstacles to doing business in Albania, the survey said
TIRANA, May 6 – Albanian businesses are pessimistic about their present situation but their expectations are among the most optimistic in seven South East European economies, a Balkan Barometer business opinion survey published by the Regional Cooperation Council has found.
On a 1 to 100 scale in the Balkan Business Sentiment Index measuring business situation, current and expected demand for products/services and general economic situation, Albania scored 50.91, lower than Montenegro, Macedonia, Kosovo, Croatia, and Bosnia and Herzegovina, but higher to Serbia’s bottom score of 45.98.
Albania’s Present Situation Index was rated at 46.67, below the SEE average but its expectation index ranked 57.25 slightly higher than the region’s average.
The majority 67 percent of Albanian companies think EU membership would be a good thing for them, compared to 19 percent who responded neither good nor bad and 14 percent who described it as a bad thing, ranking Albania among the most pro-EU countries.
A considerably part of 39 percent of Albanian companies participating in the survey said their business situation had deteriorated in the past 12 months on poorer demand for products/services and job cuts.
“Business people from Croatia (75%), Serbia (74%) and Bosnia and Herzegovina (73%) are significantly more disappointed by current economic conditions than their colleagues from Albania (47%) and Macedonia (43%),” said the survey.
Anticompetitive practice of competitors, tax rates, corruption, electricity and contract violations by customers and suppliers are the main obstacles to doing business in Albania, the survey said.
The survey shows Albania had one of the highest inflation rates in the past five global crisis years with average consumer prices from 2009 to 2014 at 2.5 percent, ranking second highest after Serbia’s 7.5 percent.
Albanian companies said they sell 90 percent of their products and services domestically, with the EU being the destination of 8 percent and the SEE of 2 percent.
Business leaders whose companies export to the neighbouring economies identified the need to hardcopy documents or certifications, licenses and permits, obscure or inconsistent rules of origin and unnecessary physical examinations or inspections as main obstacles to their exports.
“As in the case of import, Albania has fastest export procedures – only one day is needed for exported goods to clear customs,” the report noted.
Considering the whole SEE region, business representatives have divided opinion regarding the CEFTA agreement – 37 percent of them agree that their companies benefits from it, while slightly more – 41 percent have opposite experience.
Albanian companies said they spent 2 percent of their total spending in advertising and marketing, 2 percent in research and development and 18 percent in new buildings, machinery and equipment in 2014, considerably lower compared to regional companies especially on marketing and advertising.
More than half of Albanian companies, 53 percent, said their firms had acquired new production technology over the past three years, considerably higher to the SEE average of 44 percent.
Albania (65%) and Kosovo (64%) use virtual social networks significantly more compared to Serbia (40%) and Croatia (39%) and Bosnia and Herzegovina (46%).
With the intention to engage more closely the general public and the business community in the context of the SEE 2020 Strategy, the Regional Cooperation Council commissioned a comprehensive survey on attitudes, experiences and perceptions, which was carried out in December 2014, in all seven economies covered by the Strategy.
The report provides data and analysis on various topics covered by five pillars of SEE 2020 Strategy, including life/business satisfaction, assessment of general trends and attitudes on EU integration and regional cooperation with face to face interviews with 1000 respondents per each economy,
The findings paint a stark picture of a set of economies that have not been doing well and are not expected to do much better in the future. On top of that, they are burdened with difficult problems in all the covered areas of growth including integrated, smart, sustainable and inclusive growth, as well as governance for growth, the report noted.
