WB: Significant challenges remain to achieve development objectives

TIRANA, Feb. 22 – Despite significant progress in economic and social development, Albania continues to face significant governance challenges that will need to be overcome if the country is to achieve critical development objectives, the World Bank warns in a report. Enduring politicization of the public administration and incomplete separation of powers, exemplified by instances of political interference in judicial processes, remain serious obstacles. Further efforts to strengthen the rule of law, ensure security of property rights, eliminate corruption, and improve government effectiveness are necessary to accelerate Albania’s integration with the EU, increase the country’s international competitiveness as an investment destination, and improve the quality and efficiency of public service deliveryءll of which are key priorities in the Government of Albania’s National Strategy for Development and Integration (NSDI) for 2007-2013, says the World Bank in the “Governance in Albania: A Way Forward for Competitiveness, Growth, and European Integration” report.
In particular, it will be necessary to work toward closing the gap between laws and policies as they stand on paper and their actual implementation. Another area of focus relates to the weak enforcement of regulatory policies and inconsistent application of laws, notably in the protection of real property rights, which pose serious constraints to improving Albania’s business climate, suggest the World Bank.
The Government will need to define a results framework with measurable indicators and ensure regular monitoring of implementation progress, ideally as part of the NSDI monitoring and evaluation process.
In its earlier growth agenda for Albania, the World Bank suggested that Albania can sustain growth in the future by implementing a new generation of policies and reforms focused mainly on education and skills, ICT development, the energy sector, and better governance and rule of law. “Reaching the upper middle income country status in a relatively short time is a major achievement. It also poses new challenges. Under this new status Albania has to compete with low-wage poorer countries as well as with rich country innovators,” said Kseniya Lvovsky earlier.
Albania ranked 82nd in the 2012 Doing Business report by the World Bank and IFC, worse than neighbouring Macedonia and Montenegro. “In Albania dealing with construction permits became more difficult because the main authority in charge of issuing building permits has not met since April 2009.” However, registering property has progressed and is mentioned as a reform. “Albania made property registration easier by setting time limits for the land registry to register a title,” says the report.
Albania’s best performance was reported in the protecting investors and getting credit categories ranking the world’s 16th and 24th, respectively. Albania’s third best indicator in the report was starting a business in which the country ranked 61th especially because of the short time it takes, five days and few procedures which are carried out at the National Registration Center, a one-stop-shop facility. Albania ranked 64th in resolving insolvency, 76th in trading across borders, 85th in enforcing contracts.
Registering property, paying taxes, getting electricity and dealing with construction permits are the worst indicators for Albania ranking the country from the word’s 118th to 183th.
Albania enjoyed an average annual growth rate of 6 percent from 2003 to 2008 and was one of the few countries to register positive growth of 3.3 percent in 2009, when the financial crisis broke out. According to the country’s Institute of Statistics, the 2010 growth was at 3.9 percent, down from 7.5 percent in 2008.