“In the next two months, we will lift the exclusivity of international flights from the Rinas airport which paves the way to the opening of new airports in southern Albania and lower ticket prices,” says Tourism Minister Ahmetaj
TIRANA, May 6 – The Albanian government is expected to make the tourism industry more competitive through tax incentives, public-private partnerships and the opening of new airports in southern Albania, Tourism Minister Arben Ahmetaj has said introducing a draft law on tourism.
“The law will not work wonders but it is a good start for tourism. It will offer more opportunities to enterprises in the exploitation of beach territories. We target reducing informality and increasing the quality of services. The law also sets the foundations for the standardization of hotels and their star rating,” said Ahmetaj.
The minister, also responsible for economy and trade, said he will introduce a package which also envisages reducing VAT on tourism from a current 20 percent to 10 percent.
Reducing VAT on tourism has been a perennial request by the Tourism Association to make one of the key industries in Albania more competitive compared to other regional countries where VAT on the tourism sector ranges from 5 to 8 percent.
The Tourism Ministry also confirmed negotiations with the Tirana International Airport are on track to lift its exclusive rights on international flights that would pave the way to the construction of new airports in southern Albania which features some of the country’s best beaches along the Adriatic-Ionian coastline.
“In the next two months we will lift the exclusivity of international flights from the Rinas airport which paves the way to the opening of new airports in southern Albania and lower ticket prices,” said Ahmetaj.
The Albanian government says it is in its final stage of negotiations with the TIA concessionaire over lifting its exclusive rights on international flights to pay the way to the operation of the new United Arab Emirates-funded Kukes airport in northeastern Albania and the construction of a new airport in southern Albania serving the tourism industry.
With ten years having already operated TIA, the concessionaire retains the exclusiveness of international flights in Albania which is barrier for the opening of new airports in Albania.
Since April 2005, the airport has been managed by TIA, a consortium led by Germany’s Hochtief AirPort GmbH (HTA), under a 20-year concession to be in charge of the airport’s activities.
Strategic investors in Albania’s tourism sector will be offered state-owned property for a symbolic 1 Euro under 99-year concession contracts to develop tourist resorts, according to a new draft law on tourism which has been submitted to Parliament.
Experts consider the new law a good opportunity to attract strategic foreign investors considering the chaotic development of tourism and urban massacres in the past two decades in the key tourist destinations and that a considerable part of the Albania’s coastline remains virgin.
Back in 2009, France’s Club Med withdrew from a major holiday resort project in Albania’s southern Ionian coast under a similar deal after continuous land disputes with local inhabitants despite a court ruling in favour of the investor’s 99-year concession deal with the Albania government, unveiling the long-standing issue of clear property titles which is often one of the key barriers to foreign investors in Albania.
“The goal of this law is to promote Albania as a top Mediterranean destination and attract foreign and domestic visitors based on sustainable tourism. It regulates the activity of domestic and foreign tourism operators, making sure that the available tourism services meet tourists’ expectations in a healthy and safe environment,” says the report to the draft law.
Bank of Albania data shows the foreign investment stock in hotels and restaurants dropped to 64 million euros in 2013, down from 94 million euros in 2008 just before the onset of the global financial crisis.
Tourism revenue registered a record high of 1.2 billion euros in 2014 when more than 3.6 million foreign tourists visited Albania, according to data published by the central bank and INSTAT.
Ethnic Albanians from Kosovo, Macedonia, Montenegro account for three-fifths of foreign tourists visiting Albania, with local experts often referring to this market as ‘patriotic tourism.’
