Remarks on Business and Investment in Albania

Speech of the USAID Mission Director Edward T. Landau at the
Second Albania Business and Investment Summit
September 14, 2007

Mr. Minister of Economy, Trade and Energy,
Distinguished Guests,

It is a great pleasure for me to participate in this Business and Investment Summit. As you know, we are now witnessing an exciting moment in the Albanian history. The Albanian people have demonstrated their courage and determination to move rapidly towards an economically viable democracy. I am pleased to reconfirm the United States Government’s commitment to assisting Albania to become a competitive player in the global market and to achieve its goal of full integration into the Euro-Atlantic Alliance.

Albania has made much economic progress in recent years with an impressive growth of the economy. The country has restored and maintained macroeconomic stability, increased public order, and furthered structured and institutional reforms. Private sector share of GDP has significantly increased. The budget deficit is manageable, inflation is under control, the currency is stable, and the government has projected an image of competent management of the economy and continued commitment to reform. Albania has become a member of the WTO and signatory of several regional Free Trade Agreements.

USAID’s assistance program in Albania aims to help the country achieve sustained, broad-based economic growth through promoting private enterprise development, decreasing trade deficit, increasing domestic and foreign investment and creating employment. We focus our economic development activities in three major areas: (1) trade and investment environment; (2) private sector competitiveness; and (3) energy sector restructuring.

To improve trade and investment environment, we provide technical assistance to build public and private sector capacity to support trade liberalization and agreements and to assist the government to implement sound policies and administrative actions to establish a favorable investment environment. With the assistance of the Millennium Challenge Account Threshold Program, the Government of Albania opened the National Registration Center four days ago. Since its opening, the center has been fully functioning as a one-stop shop where the registration of a business can be completed in one day. We expect important reforms of the tax system and the public procurement system to follow within a year. Another activity of our program – the Albanian Center for International Trade (ACIT) – is providing technical support to the public and private sectors in addressing issues concerning trade policy, WTO, and Free Trade Agreements. ACIT has been a principal source of up-to-date trade information serving not only the Albanian government and private sector but also the international donor community and businesses.

To improve private sector competitiveness in both domestic and international markets, our assistance is focused on building the firm-level capacity to increase efficiency, lower production costs, and improve product quality in addition to improving the trade and investment environment mentioned above. Selected enterprises in both agricultural and non-agricultural sectors receive technical assistance and training to: (1) improve technical and managerial capacity, (2) increase access to financial resources for technological innovations, business expansion and diversification, and (3) identify and respond to business and trade opportunities.

We have a special interest in the agricultural sector which has a high potential for growth due to its many comparative advantages. Last month, we started a new five-year project to improve the agricultural productivity, production and competitiveness. We support the efforts of the Albanian Government to attract foreign investment in this sector.

We recognize that the current energy crisis has an adverse effect on the economic growth and may discourage investment. However, I think, with the strong support of the donor community and the commitment of the Albanian Government, the energy situation will improve. USAID is collaborating with the Government and other donors such as the World Bank and IFC to find short- and long-term solutions to the crisis and to assure a reliable and adequate supply of electricity for residential and industrial uses. Our technical assistance focuses on improvement of the regulatory environment, establishment of the open electricity market, Albania’s participation in the regional energy market, and the privatization of the energy sector.

I just presented to you, in a nutshell, our assistance programs that are closely related to business and investment. I would like to take this opportunity to express our interest in collaborating with investors in the sectors that our programs target.