TIRANA, April 12 – Almost half of the Albanian population lives on less than $5 a day, worse than almost all regional countries, according to a World Bank report.
In its latest South East Europe Regular Economic Report, the World Bank says Albania’s poverty, measured against the regional standardized benchmark of US$5 a day (in 2005 purchasing power parity) was down by 1.5 percent to 46.2 percent of the population in 2016 considerably higher than in neighboring Macedonia, Montenegro and Serbia where poverty rates ranged from 12 to 18 percent of the population.
“While higher growth in 2015 brought new jobs in the private sector, and helped poverty reduction to resume, unemployment is still entrenched at 21.5 percent,” says the report about the regional landscape.
“Poverty is expected to decline, but challenges for poverty reduction remain with the high volatility of growth, limited fiscal space for mitigating adverse shocks, and still low labor force participation and high unemployment rates,” adds the report.
The country’s high unemployment rate at 17 percent and some tough nationwide reforms to tackle electricity thefts and debts and tax evasion are estimated to have been among the key reasons that led to some 66,000 Albanians seeking asylum in EU countries in 2015, mainly to Germany.
Albania’s poverty rate increased by 2 percent or about 29,000 people from 2008 to 2012 after the onset of the global financial crisis, according to an earlier survey conducted by Albania’s state statistical institute, INSTAT, and the World Bank.
The fraction of the population whose real per capita monthly consumption is below Lek 4,891 (€34.6) increased from 12.4 percent in 2008 to 14.3 percent in 2012. In the previous years, poverty fell from 25.4 percent in 2002 to 18.5 percent in 2005 and 12.4 percent in 2008. This means that roughly 28,896 people in addition to 373,137 poor people in 2008 fell into poverty. Extremely poor population, defined as those with difficulty meeting basic nutritional needs, increased from 1.2 percent in 2008 to 2.2 percent in 2012. In 2012, extreme poverty increased for both urban (2.2 percent) and rural areas (2.3 percent), says the survey.
The sharp cut in migrant remittances from Italy and Greece, where an estimated 1 million migrants live, has also had an impact in rising poverty rates.
Migrant remittances slightly recovered to €598 million in 2015, but remained almost 40 percent below their peak level of €952 mln in 2007 just before the onset of the global financial crisis, according to revised data published by the country’s central bank.
Albania’s GDP per capita, an indicator for a nation’s economic situation, slightly rose to €3,440 in 2014 but remained one of the lowest among eight regional EU aspirants, according to data published by Eurostat, the statistical office of the European Union.
At €3,440 in 2014, Albania’s GDP per capita was probably higher only compared to Kosovo whose 2013 GDP per capita was at €2,835. The GDP per capita in Bosnia and Herzegovina, Macedonia, Serbia, Montenegro and Turkey ranged from €3,641 to €7,819 in 2014.
However, when it comes to the size of the GDP, Albania leaves behind neighboring Kosovo, Montenegro and Macedonia. Albania’s GDP was estimated at about €10 billion in 2014 when the economy grew by 2 percent.
Albania’s GDP per capita expressed in purchasing power standard (PPS), an artificial currency unit that eliminates price level differences between countries, slightly climbed to 29 percent of the EU 28 average in 2014, up from 27 percent in 2013 ranking better only compared to Bosnia and Herzegovina’s 28 percent in a 37-country list which includes 28 EU member states, three EFTA members, five EU candidate countries and one potential candidate.
