TIRANA, June 13 – Foreign investors in Albania say they are deeply concerned about the impact of the ongoing political crisis and its escalation after the May 8 local elections– warning of the negative effects the instability could have on the country’s economy.
Patrick Pascal, the president of Foreign Investors Association of Albania (FIAA), which represents most of the FDI stock in Albania, told reporters that a normal political situation is a key condition to doing business and attracting foreign investments.
Appealing for calm and dialogue among Albanian politicians, Pascal says that the unclear political situation, accompanied by the slowdown in consumption and a worsening condition in key sectors such as the food industry and services are carefully studied by foreign investors before deciding to come to Albania.
“We are neutral spectators of the situation and the business community does not want anything else other than a quiet political climate so that enterprises are normally developed, favoring employment and exports and pushing the country’s long- term development,” says Pascal.
According to FIAA, the companies operating in the food industry and service sectors are currently reporting lower profits, and as a result, are postponing their investments.
Local Albanian business associations warned earlier this year, the tourism industry would be the most affected by the ongoing political crisis and the Jan. 21 incidents during anti-government protests. The images of violence and killings aired all over the world were considered devastating for Albania, which had been placed as a top destination to visit for 2011.
FIAA, which has been present in Albania for 10 years, mainly represents stock from Italy, Greece, France, Germany, Austria, Turkey, Egypt, the UK, the US, and a range of economic sectors such as banking and finance, construction, consulting, telecommunications, trading, and the hospitality industry.
FDI grows to 837 mln Euros
Foreign direct investment, one of the main sources of Albania’s economic growth and accounting for around 8 percent of the GDP, registered a record 837 million Euros in 2010– the highest level of the past seven years. Central bank data reveal FDI during the whole of 2010 rose by 19 percent or 157 million Euros compared to 2009. Data show FDI more than doubled to 250 million Euros in the final quarter of 2010 compared to the same period in 2009.
Privatization in key sectors (banking, telecommunications and energy) has been the main source of FDI.
The launch of a new privatization wave under which the government has identified 1,280 public assets, including strategic enterprises, is expected to give another boost to FDI and increase government revenues.
The privatization list includes remaining state owned shares in strategic oil, and phone Large hydropower plants and dams, schools, hospitals and public buildings and offices will remain under state ownership.
