Albanian market has changed considerably since the change of political system in 1990 and the introduction of the free market economy. From a country with almost a “ground zero” business environment which lacked infrastructure, experience, and managerial skills, the current market has come a long way to take a more structured shape with obvious players, winners and losers. From a Wild West era two decades ago, where enterprising cowboys ventured in the midst of the chaotic Albania to seize the endless opportunities, we are now faced with big multimillion companies directing giant projects worth billions of euro.
Today the market is aggressive, full of dynamics, where self made local companies fight tooth to tooth with corporations coming from abroad. The government is doing the impossible to ensure the fight keeps going, implementing more appealing regulations, and invite new interesting players. While the market is still young and ever expanding, companies now need to consolidate their share or be pushed out. A view to cherish even for Adam Smith.
But who are the players with the highest turnover in the private sector and how did they get where they are?
Bechtel & Enka and the Patriotic Highway
For the second year in row, Bechtel & Enka makes the top ten, and not only, it also leads it. It is thanks to its gigantic project building the Durres-Kukes highway which is the Albanian part of the Durres-Pristina Highway that will connect Albania and Kosovo. Also known as the Patriotic Highway, because it will connect 2 countries of the same nation, the Durres-Pristina is thought to have huge economic importance, connecting the biggest port in Albania with the internal part of the Balkans. Countries like Macedonia and Serbia, other then Kosovo, should benefit greatly from this new infrastructure. It will also consolidate Albania’s geopolitical and now also economical position as a gate, or bridge, to the Balkans.
Bechtel & Enka is a Turkish-American consortium. It’ turnover in 2008 was 321 million euro, which ranked at the top of private companies, and 2nd overall, behind KESH, Albania’s Electro-Energy Corporation. The whole Durres-Kukes project has a cost of 1.4 billion euro making it by far the biggest investment in Albanian infrastructure.
Vodafone Albania ranks 2nd
Truth being told cell phone market in Albania is a highly profitable one, for one simple reason. Until 2008 it only had two players, Vodafone Albania and AMC, and they did what they wanted with cell phone rates being fantastically higher than anywhere else in the region. One would have thought he/she was calling Jupiter with those rates.
Vodafone enter Albania in 2001m a year after AMC. It managed to surpass its rival last year in terms business size. The cell phone operator recorded a turnover of 219 million euro, a growth of 14%. It is somewhat surprising considering that a third operator entered the market in 2008 and slashed tariffs almost in half which of course should have hurt the leaders somewhat. But Vodafone, thanks to a great leadership, and lots of new services thrown in market, not only kept growing, but it had done so in a faster way.
AMC drops a spot to its rival
Albanian Mobile Corporation is the Albanian subsidiary of the Greek Cosmote, freshly purchased by Deutsche Telekom. AMC was the first to enter the Albania market and has been the leader since 2008. Like its counterpart, AMC continued to grow, with a turnover increase of 8%. While it did lose grounds to Vodafone in terms of business size, AMC is still the most efficient recording higher profits.
ARMO, the oil adventurer
The well known Albanian businessman, Rezart Taci, made the headlines in 2008. He wand the public tender to privatize ARMO, the former state-owned oil company. The competition was supposed to be fierce for such a strategic company, but Taci left all his drooling by making an offer much higher than ARMO’s worth. The other bidders rolled their eyes, call Thaci a nutcase, and moved on.
Mr. Taci was educated in Italy, where he also waited tables to make ends meet. Currently he is the owner of Taci Group with an annual turnover higher than 300 million euro. ARMO’s turnover in 2008 was 187 million euro ranking it 4th in the list.
But Taci is not stopping here. His latest ambition is to expand in the Seria A, the Italian top professional league in football. He had 20 million euro bid accepted to purchase an 80% stake of Bologna, a club in Seria A, but Taci himself pulled the plug at the last minute. It seems Taci plans to put his hands on a much bigger fish, known as AC Milan, a world football powerhouse. It’s owner, Silvio Berlusconi, is the ever funny Prime Minister of Italy and close friends with Mr. Taci. Things don’t look that goo though as Taci face competition from Arab investors, and Berlusconi seems reluctant to sell despite the financial difficulties of the club.
Kurum International, a Turkish style growth
Kurum is simply the giant of the Albania iron industry. The closest competitors cannot even cover a quarter of the production this Turkish giant makes every year. Kurum recorded a turnover of 139 million euro, a whopping 70% growth. What makes it so easy for the company is its access to other markets. Kurum exported 100 thousand tons of iron to Greece, Kosovo, and Montenegro in 2008.
There has been concerns regarding the safety of the applied technology, but Kurum is already investing to leave no space for errors.
Agna Group, united we grow
Agna Group includes a range of companies involved in production, distribution, and advertising. It has a variety of products such as soft drinks, food products, furniture, and billboard commercials. Its turnover in 2008 was 125 million euro. The Group employs some 750 people.
Kast-Petrol, the big importer
The company is the biggest petrol importer in the country and has its own gas station chain throughout the country. It imported 72 thousand tons of petrol in 2008 for a turnover of 93 million euro. Kast-Petrol has been operating the market for 14 years now, most of it as a leader. Shefqet Kastrati is the owner
Taci Oil, it’s that guy again
Taci Oil is Mr. Taci’s own creation before he also got his hand on ARMO. Taci Oil recorder an impressive 31% growth in 2008 with a turnover of 82 million euro.
Bankers Petroleum, all the way from Canada
The Canadian based company, Bankers operates and has the full rights to develop the Patos Marinza and Ku谶a heavy oilfields pursuant to a 25 year license agreement with the Albanian National Agency for Natural Resources (AKBN) and a Petroleum Agreement with Albpetrol Sh.A (Albpetrol), the state owned oil and gas corporation. The Patos Marinza oil field is the largest onshore oil field in continental Europe, holding approximately two billion barrels of original oil in place. BP does both extraction and the export of the oil. The product is refined abroad. In 2008 Bankers Petroleum exported 78 million euro worth of Albanian oil. Bankers shares are traded on the Toronto Stock Exchange (TSX) and the Alternative Investment Market (AIM) in London, England under the ticker symbol BNK
Viloil Alpet, the young vs. the old
Also known as ALPET, the company is a relatively young company in the market. However, it has swiftly moved to become one of the top players. It’s competitive weapon is quality. The company imported 70 thousand tons of oil in 2008 and sold it all through its own gas station chain. Its total turnover amounted to 76 million putting it quite close with the other leaders in the markets such. ALPET is own by the TNA, a Turkish oil company.
Companies to watch
There are many other companies out there that continuously dominate the business headlines in Albania and beyond. Even though they haven’t made the top ten, their potential is huge and should soon jump the ranks.
OSSH: The Distributing System Operator (OSSH) was privatized in 2009 by CEZ, the Czech energy giant that operates in Central and South East Europe. CEZ purchased 76% in shares of the company for 102 million euro. OSSH, which decides the electric energy tariffs and collects the electricity bills will have a hard job, will have a hard time ahead of it as it needs to improve administrative infrastructure and collectability efficiency of payments. But energy prices will increase in the future, and the whole sector is currently under huge investments which will result in overall better production and higher consumption. CEZ is bound to experience a high pace of growth in the close future.
Albtelecom & Eagle Mobile: Albtelecom is the fixed phone operator in Albania. Despite enjoying a monopoly till late, it also covered only 10% of the potential market. Huge investments are being done in infrastructure and services. The potential is huge.
Eagle Mobile is the cell phone operator wing of AlbTelecom. They are both owned by the same Turkish consortium, CETEL Telecommunications. Eagle mobile entered the Albanian market as the third operator behind Vodafone and AMC. Even thought it still early, the company has performed formidably gaining a respectable market share so far through aggressive tactic of lower tariffs and an endless variety of services introduced on monthly basis.
ENEL: The Italian energy giant has signed 2 contracts with the Albanian government regarding energy projects in the country for a total value of 3.5 billion euro making it the biggest piece of business in Albania yet.
Note: Figures for this article were taken from Monitor, the most prestigious business magazine in Albania. Tirana Times has added additional information for companies above and is hoping to bring its reader more data on the Albanian market and the most important do-makers in the private sector
