Albania Economy

Is Albania a rich country?

Albania, a formerly closed, centrally planned state, is a developing country with a modern open-market economy. Albania managed to weather the first waves of the global financial crisis but, the negative effects of the crisis caused a significant economic slowdown. Since 2014, Albania’s economy has steadily improved and economic growth reached 3.8% in 2017. However, close trade, remittance, and banking sector ties with Greece and Italy make Albania vulnerable to spillover effects of possible debt crises and weak growth in the euro zone.



Remittances, a significant catalyst for economic growth, declined from 12-15% of GDP before the 2008 financial crisis to 5.8% of GDP in 2015, mostly from Albanians residing in Greece and Italy. The agricultural sector, which accounts for more than 40% of employment but less than one quarter of GDP, is limited primarily to small family operations and subsistence farming, because of a lack of modern equipment, unclear property rights, and the prevalence of small, inefficient plots of land. Complex tax codes and licensing requirements, a weak judicial system, endemic corruption, poor enforcement of contracts and property issues, and antiquated infrastructure contribute to Albania's poor business environment making attracting foreign investment difficult. Since 2015, Albania has launched an ambitious program to increase tax compliance and bring more businesses into the formal economy. In July 2016, Albania passed constitutional amendments reforming the judicial system in order to strengthen the rule of law and to reduce deeply entrenched corruption.



Albania’s electricity supply is uneven despite upgraded transmission capacities with neighboring countries. However, the government has recently taken steps to stem non-technical losses and has begun to upgrade the distribution grid. Better enforcement of electricity contracts has improved the financial viability of the sector, decreasing its reliance on budget support. Also, with help from international donors, the government is taking steps to improve the poor road and rail networks, a long standing barrier to sustained economic growth.



Inward foreign direct investment has increased significantly in recent years as the government has embarked on an ambitious program to improve the business climate through fiscal and legislative reforms. The government is focused on the simplification of licensing requirements and tax codes, and it entered into a new arrangement with the IMF for additional financial and technical support. Albania’s three-year IMF program, an extended fund facility arrangement, was successfully concluded in February 2017. The Albanian Government has strengthened tax collection amid moderate public wage and pension increases in an effort to reduce its budget deficit. The country continues to face high public debt, exceeding its former statutory limit of 60% of GDP in 2013 and reaching 72% in 2016.

Albania Economy Data

What is the GDP of Albania?

GDP - Gross Domestic Product (PPP) $36,010,000,000 (USD)
GDP - note unreported output may be as large as 50% of official GDP
GDP - official exchange rate $13,070,000,000 (USD)
GDP - real growth rate 3.8%
GDP Per Capita $12,500.00 (USD)
GDP by Sector- agriculture 21.7%
GDP by Sector- Industry 24.4%
GDP by Sector- services 54.1%
GDP - composition, by end use household consumption: 78.1%

government consumption: 11.5%

investment in fixed capital: 25.2%

investment in inventories: 0.2%

exports of goods and services: 31.5%

imports of goods and services: -46.6%
Population Below Poverty Line 14.3%
Inflation Rate 2%
Labor Force 1,198,000
Labor Force By Occupation- agriculture 41.4%
Labor Force By Occupation- industry 18.3%
Labor Force By Occupation- services 40.3%
Unemployment Rate 13.8%
Unemployment - note these official rates may not include those working at near-subsistence farming
Fiscal Year calendar year
Annual Budget $3,614,000,000 (USD)
Budget Surplus or Deficit - percent of GDP -2%
Public Debt (% of GDP) 71.8%
Taxes and other revenues - percent of GDP 27.6%
Major Industries food; footwear, apparel and clothing; lumber, oil, cement, chemicals, mining, basic metals, hydropower
Industrial Growth Rate 6.8%
Agriculture Products wheat, corn, potatoes, vegetables, fruits, olives and olive oil, grapes; meat, dairy products; sheep and goats
Currency Code 121.9
Child Labor - % of children ages 5-14 12%
Child Labor - # of children ages 5-14 72,818
Commercial Bank Prime Lending Rate 8.22%

Labor Force by Occupation- As reported by Albania

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