New attempts made to revitalize Tirana Stock Exchange

TIRANA, July 2ؔhe new government coming out of the June 28 election will try to rebuild the missing capital market in Albania, or more specifically, Tirana’s stock exchange. The revitalization of the stock exchange is apparently one of the priorities of the economic agenda of the opposing camps.
A few days before the election, in a meeting with the business community, Minister of Economy, Genc Ruli, declared that revamping the Tirana Stock Exchange (TSE) was a main objective for their new legislation.
Premier Berisha promised the same by declaring that the capital market was to be inaugurated in 2009 with five companies to be listed for the first time on the TSE. According to the Albanian premier, USAID experts are working to draft a working plan for TSE based on the Polish model.
However, experts doubt anything concrete is about to happen anytime soon regarding TSE. They point to the informal economy as the main obstacle to a functional capital market. Most companies prefer to work with two different balance sheets a.k.a “cooking the books” and are not interested in listing themselves in a regulated market. The so called “grey economy” makes up between 30-40 percent of the country’s GDP and currently, Albania is the only European country without a capital market.
A capital market is important for a country’s economy as it offers an investment alternative to both companies and individuals from banks. In addition, a functional stock exchange is an imperative to EU integration as a basic requirement for participating in a unified regional and global capital market and therefore adding to opportunities for foreigners to invest in the country.
The Tirana Stock Exchange was created in 1996 as a department of the Bank of Albania (BoA) with its basic activity being the secondary trading of treasury bills and government obligations.
The TSE separated from the BoA in July 1, 2002, and became a shareholding company, but its activity is at best negligible.