Privatization in Albania in numbers

• Author: Endri Papajorgji Greta Alikaj
• Position: Vice Rector and Dean of the Faculty of Law of TBU (Tirana Business University) - Albanian Ministry of Economic Development, Tourism, Trade and Entrepreneurship
• Pages: 41-46

41

IIPCCL Publishing, Tirana-Albania

Academic Journal of Business, Administration, Law and Social Sciences Vol. 1 No. 3

November 2015

ISSN 2410-3918

Acces online at www.iipccl.org

Privatization in Albania in numbers

Prof. assoc. Dr. PhD (Uni Graz) Endri Papajorgji

Vice Rector and Dean of the Faculty of Law of TBU (Tirana Business University)

MSc. Greta Alikaj

Albanian Ministry of Economic Development, Tourism, Trade and Entrepreneurship

Abstract

The privatization process after the 90’s has laid the foundation stone for Albania’s EU

integration, not only in the economic, but also in its legal field. In the late 80’s an ideological,

political, economic system disintegrated and in Albania as in all countries of Eastern Europe,

democracy, free market economy and the rule of law, based on private property and free market

economy were the foundation of the transformation. But the way this transformation had to

be mastered was not clearly defined. For more than 40 years, Albanian citizens were faced

with the communist ideology as the basis of state government regulation. This ideology stated

that, all citizens had contributed the same way and in the same extent during socialism for the

construction of state and social property. In Albania, as in all other countries of Eastern Europe,

the so-called “Rent seekers” were transformed into Oligarchs and Owners of the privatized

state-property for little money. In this context, this process was accompanied by the deficiency

of accurate economic statistics, privatization strategies, foreign investors, a bad policy

implementation as well as delays in the framework of immediately needed reforms (Åslund

2013). Main objective of this article is the Analysis of the privatization process in Albania

through statistics.

Keywords: Privatization, Economy, law, Albania, EU.

Introduction

Albania was mainly an agrarian state before communists came into power in 1944.

Agriculture constituted more than 90 % of domestic production; meanwhile the

industry consisted in less than 4%. Construction and services sector constituted

approximately 3 % of general production costs. Table 1 indicates the structure of net

production from 1938-1989. It is apparent, that during the communist regime, the

percentage of industry gradually increased until it reached 45%, meanwhile agriculture

fell by 33%. In accordance with the communist ideology, heavy industry was a priority.

Heavy industry as part of the whole industry grew from 48, 9% in 1960, to 63,9% in

1988, meanwhile the percentage of small enterprises declined from 51,1% to 36,1 %

during the same period (Pashko, 1991). The number of employers in the industry

sector increased continuously during 1938-1989. In 1990, the percentage of employers

in the industrial sector constituted 27, 5% of all employers, meanwhile 60% were

employed in the agricultural sector (EIU, 1994).