Albania – Investment facts
A potential candidate country for EU accession, Albania is a member of World Trade Organization since 2000 and a NATO member country since April 2009.
Albania has achieved strong economic positive growth despite the global economic and financial crisis with a GDP growth of 6% for the period 2000-2009, and of more than 3% for years 2010 and 2011 respectively.
Strategically located in the Western Balkans, with its developing market economy, low tax burden and its young, educated and cost competitive workforce, Albania offers many opportunities for investors. Albania’s natural resources include significant hydro, solar and wind power capacity, large tracks of agricultural land and over 400 km of coastline with excellent tourism potential. The country is rich in oil and gas and is endowed with valuable mineral deposits such as copper, iron and chrome ores.
Well anchored structural, legal, fiscal and administrative reforms focusing on trade liberalization and ease of doing business, have boosted investments in Albania.
Albania ranks in the countries with the highest performance index meaning that the number of foreign investments received was above expectations and this thanks to improvements in its investment climate. The focus for the future development of the Albanian economy will remain on attracting FDIs with a focus on sectors where the Albanian economy has unexploited potential both in terms of natural resources as well as in developing sectors that are yet under-performing such as renewable energy, tourism, agribusiness, infrastructure and services. Albania has adopted a liberal framework which has been designed to create a favorable investment climate for foreign investors. Albania has also signed a considerable number of Bilateral Investment Treaties with different countries such as United Kingdom, France, Germany, Italy, Austria, Switzerland, United States, China, Russia, Israel, Egypt, Cyprus, Turkey etc.
Albania’s economic freedom score is 66,9 out of 100 (most free) making its economy the 54 Freest in the 2014 Index. Its overall score has increase by 1.7 points, with notable improvements in investment freedom and trade freedom. Albania is ranked 25th among the 43 countries in the Europe region, and its overall score is above the world average.
FDI Legal Provisions
Law no.7764, dated 02.11.1994 “On Foreign Investments” creates a favorable investment climate for foreign investors in Albania. It offers all foreigners, either physical or judicial persons, a range of provisions including:
- No sector is closed to foreign investment and no prior government authorization is needed to invest.
- There is no limitation on the percentage share of foreign participation in companies – 100 % foreign ownership is possible.
- Foreign investment may not be expropriated or nationalized directly or indirectly, except in special cases, in the interest of the public, defined by law.
- Foreign investors have the right to expatriate all investments in the form of funds and contributions in kind.
- The most favorable treatment according to international agreements is provided.
Albania’s tax system also does not discriminate against foreign investors.
Legislation concerning the public procurement process makes little distinction between foreign and domestic firms.
Investors in Albania are entitled to judicial protection through rights related to their investments. Should there be a dispute; parties may submit claims to an arbitration institution for consideration. Foreign investors also have the right to submit disputes to an Albanian court or to the Arbitration Court in Tirana. Provisions on domestic and international commercial arbitration can be found in the Code of Civil Procedure.