Albania country brief

Bilateral relations

Australia first established diplomatic relations with Albania in 1985 when the isolationist communist regime established by Enver Hoxa following WWII was still in power. Non-resident accreditation to Albania is held by the Australian Ambassador in Athens while the Albanian Ambassador to China, resident in Beijing, has traditionally been accredited to Australia. Albania is represented in Australia by an Honorary Consulate-General in Adelaide. The 2006 Census recorded 11,315 people of Albanian ancestry living in Australia. Albania's national day is celebrated on 28 November.

Parliamentary Secretary for Foreign Affairs, Richard Marles, made the first visit by a member of an Australian Government to Albania in April 2012. Mr Marles met senior members of the Government including Prime Minister Sali Berisha, Foreign Minister Edmond Haxhinasto and Deputy Defence Minister Arjan Starova. He also met with the Speaker of Parliament, Josefina Topalli, and the Mayor of Tirana, Lulzim Basha.

Trade between Australia and Albania is small; two way merchandise trade in 2011 totalled A$3.6 million. Australian exports to Albania have risen steadily from A$2.1 million in 2010 to A$3.1 million in 2011, and consisted mainly of margarine, vegetables, beef, and raw hides and skins (excluding furskins). Imports from Albania in 2011 were valued at A$0.54 million and consisted mainly of clothing.

In recent years, the Australian Government and a number of humanitarian aid organisations such as the Children First Foundation and the Melbourne Overseas Missions have provided financial and humanitarian assistance to Albania. Through the Embassy in Athens, Australia has supported several humanitarian projects with developmental benefits for local communities. In 2010-11 the Embassy committed just under A$22,000 to NGOs for programs relating to nutrition and income generation and combatting people trafficking.

General overview

The Republic of Albania is a small, mountainous country on south-eastern Europe's Balkan Peninsula, bordering the Adriatic Sea to the west and with land borders to Greece to the south, the former Yugoslav Republic of Macedonia to the East and Montenegro and Kosovo to the North. Albania occupies an important strategic location in the Balkans along the Strait of Otranto which links the Adriatic Sea to the Ionian Sea and the Mediterranean Sea. The name Albania is derived from an ancient Illyrian tribe, the Albanoi, forebears of the modern Albanians. The Albanian name for the country is Shqiperise or 'Land of the Eagle'. The capital of Albania is Tirana and its national independence day is 28 November.

Albania's population is approximately 2.8 million (2011 es.t of resident population). The main ethnic minoritygroups are Greeks (1.17 per cent) and other (0.23 per cent) comprising of Vlachs, Romani, Serbians. Montenegrins, Bulgarians, Balkan Egyptians and Macedonians. Seventy per cent of Albanians are Muslim, 20 per cent Albanian Orthodox and 10 per cent Roman Catholic. [In November 1990, religious practice was again permitted after prohibition by the communist government in 1967.]

Political system

Albania's political system is a presidential parliamentary democracy. The Parliament of Albania consists of a unicameral assembly known as the 'People's Assembly' or 'Kuvendi Popullor'. The assembly has 140 seats; 100 are elected by direct popular vote and 40 by proportional vote for four year terms.

The most recent elections for the assembly were held on 28 June 2009. The incumbent Prime Minister, Sali Berisha, was unable to secure an outright majority, winning 47.5 per cent of the votes (70 of the 140 seats). The opposition Socialist Party Coalition led by Edi Rama, won 38.8 per cent and pressed for a re-count of votes for many months during which it boycotted Parliament. The centre-left Socialist Movement for Integration led by former Prime Minister Ilir Meta won 6.5 per cent. Berisha was appointed Prime Minister for another four years on 9 September 2009. His new government incorporates members of the Socialist Movement for Integration, the Republican Party and the Party for Democracy and Integration. The coalition government's key objective is to move Albania towards European Union accession.

The People's Assembly elects the President for a five-year term. In June 2011,Albania's interior minister Bujar Nishani was elected President, replacing Bamir Topi, whose term ended on 24 July. Nishani won 73 votes in the 140-member Parliament after three failed ballots where other candidates were unable to achievethe required three-fifths majority. This requirement shifted to a simple majority in the fourth and fifth rounds of voting, enabling the Democratic Party to unilaterally elect their preferred candidate.The drawn out process did not please the EU, which had urged Albania to display unity and elect a President in the early rounds of voting.

Foreign relations

From May 2012, Albania chairs the Council of Europe until November. The Council of Europe has 47 members and for 2011-12 is prioritising: human rights with a particular focus on the child; promoting human rights and the rule of law in the interest of democracy and stability; and strengthening of local and regional democratic processes.

Albania is a member of a number of international and regional organisations and initiatives, including NATO, the Organisation for Security and Cooperation in Europe (OSCE), the UN, the Stability Pact, the Atlantic Charter, and the World Trade Organisation (WTO).

Albania joined NATO on 1 April 2009, following formal agreement to its accession at the Bucharest Summit in April 2008, and is a contributor of troops to the International Security Assistance Force. Albania applied to become a candidate country for accession to the European Union (EU) in 2009 and is recognised by the EU as a "potential candidate country". In November 2010 and October 2011 the European Commission concluded that Albania had made progress toward accession criteria, but that this was insufficient to warrant being granted EU candidate status. The Organisation for Security and Co-operation in Europe (OSCE) has a mission in Albania led by Ambassador Eugen Wollfart.

Albania is a participant in the European Commission's Stabilisation and Association Process (SAP), which provides a strategic framework for bringing stability to the Balkans through achievement of a series of political and economic reform milestones, together with targeted financial aid to assist structural improvements. The Albanian Government strongly supported the NATO intervention in Kosovo, turning over key facilities to NATO during the period of the conflict with the Federal Republic of Yugoslavia (FRY). Following the commencement of NATO air strikes on 24 March 1999, 465 000 refugees from Kosovo crossed into Albania. The Kosovo Peace Plan was adopted by the UN Security Council on 10 June 1999 and the subsequent deployment of the NATO Peace Keeping Force in Kosovo (KFOR) prompted the spontaneous return of tens of thousands of refugees. The UN High Commissioner for Refugees (UNHCR) established an assistance program for the voluntary repatriation of the refugees and by 1 September 1999; 432 500 refugees had returned to Kosovo from Albania.

The Government has remained committed to ensuring stability in Kosovo and has continued to call for the protection of the rights of ethnic Albanians in Kosovo and the former Yugoslav Republic of Macedonia. Albania's formerly poor relations with Serbia during the 1990s improved following the removal from power of the late Slobodan Milosevic in 2000 which opened the way to the eventual restoration of full diplomatic relations in late 2002. A further step towards co-operation between the two countries occurred on 5 July 2011 with Albania and Serbia lifting visa requirements for each other's citizens. Relations between Albania and the former Yugoslav Republic of Macedonia likewise improved following parliamentary elections in the former Yugoslav Republic of Macedonia in September 2002, which produced a coalition government with a strong ethnic Albanian presence.

Albania has been responsible for a number of initiatives and played a constructive role in the region, and showed willingness to address the issue of people smuggling over the Adriatic and Ionian Seas. It has also made progress in addressing money laundering and organised crime issues in partnership with the EU, the US and other national and international agencies, including the AFP and AUSTRAC.

Economic overview

Albania is now making the difficult transition to a more open-market economy. Macroeconomic growth averaged around 6 per cent between 2004-08, but declined to about 3% in 2009-11. Inflation is low and stable. The government has introduced measures to reduce crime and has implemented a fiscal reform package to improve the economy and attract foreign investment.

Twenty per cent of Albania is fertile, arable land. It has untapped natural resources (including chrome — one of Albania's most important sources of hard-currency income) and a strong human resource base (a young population and a national literacy rate of 99.1 per cent). The median age is 30.4 years as of 2011 and 47.8 per cent of the workforce is employed in agriculture, with the rest in industry and services (2010 est.). As of March 2012, the unemployment rate officially stands at 13.3per cent

Although agriculture is Albania's largest sector - it accounts for about one-fifth of GDP - it is yet to modernise and small landholders predominate. This has caused inefficiency in the agricultural industry and, in addition to energy shortages, has stalled foreign direct investment (FDI) - the lowest in the region. The Albanian Government has developed a new thermal power plant near Vlore and plans to upgrade transmission lines between Albania and Montenegro and Kosovo to help relieve the energy shortages. Fiscal and legislative reforms have also been introduced in an attempt to improve FDI. Using EU funds, the government is upgrading the country’s poor national road and rail network, another long-standing barrier to sustained economic growth.

Albania's main industries include food processing, textiles and clothing, lumber, oil, cement, chemicals, mining, basic metals and hydropower. Export commodities include textiles and footwear, asphalt, metals and metallic ores, crude oil, vegetables, fruits and tobacco. Albania remains an extremely poor country by European standards, with 12.5 per cent of the population living below the poverty line (2008 est.) and public debt at 59.5 per cent of GDP in 2012 which is just short of its legal limit. Around 8 per cent of Albania's GDP (2010) results from remittances from Albanians working abroad, mostly in Greece and Italy. Workers' remittances and foreign aid are expected to continue to offset a widening trade deficit.

Whilst the Albanian economy has been partially sheltered from the global financial crisis, the impact has materialised in a slower economic growth. Strong trade and banking sector ties with Greece and Italy make Albania vulnerable to future spillover effects. Greece's economic crisis has already prompted some Albanian workers to return home, resulting in a decline in remittances.

Updated August 2012