Albanian Times, Volume 1, Number 2, October 22, 1995

From: Albanian Times <AlbaTimes@aol.com>

The Albanian Times (by AlbAmerica TRade & Consulting International) Directory

In this issue:

CONTENTS

[1] Albanian Social Democrats and Democratic Alliance Start Joint Electoral Campaigns

[2] Bulgarian Air Carrier Suspends International Flights

[3] German Development Minister Visits Albania

[4] Oil Smugglers Arrested at Albanian Montenegrin Border

[5] Fountain Oil's Albanian Talks

[6] Albania's Agriculture Facing a New Challenge

Forrest Walters, a consultant employed by the U-S Agency for International Development, says there has been remarkable progress during his three years in Albania, substantial improvement in the condition of the animals, improvement in the condition of the land, and the crops themselves.

Mr. Walters attributes the success both to privatization and the freeing of agricultural prices. Because price controls have ended, there has been a substantial shift away from wheat and corn into higher value added products like fruits, vegetables, and pork.

There are still immense problems in the Albanian farm sector. The infrastructure is undeveloped. The 45 years of neglect under communism have left rural areas without adequate health care, education, water, and electricity. and yet the progress is visible. The World Bank is offering low interest loans to farmers. Seeds and fertilizers are available. (Voice of America via Internet)

[7] Albania Looks Ahead at Privatization

The manager of Albania's privatization program, Niko Gliozheni credits the Czech government with providing a model for distributing vouchers to the people and then letting citizens choose the former state enterprises in which they would like to be part owners. Gliozheni says, considering the low financial status of the population, the government decided to distribute vouchers free to them and the government compensated (?) for only a small part of what the citizens deserved. But the companies designed for privatization are still alive, there is still value in them.

The vouchers were distributed beginning last June. They could be bought for a nominal fee equivalent to half a U-S dollar. Each voucher certificate has a declared value of at least 105 dollars. The list of the first 20 companies available in exchange for vouchers was published last month. Right now, citizens are choosing where to invest. Mr. Gliozheni is not distressed that the vouchers are trading at a 75 percent discount to their face value. The privatization director frequently appears on television in an educational role, urging citizens to regard the voucher as cash and exchange it for ownership shares in Albanian companies.

Albania's privatization program will be speeded up in the next few months and is scheduled to be completed by June of next year. (Voice of America via Internet)

[7] Restauranteur plans McDonald's franchise in Tirana

Bardha and his daughter already own La Piazza, an elegant Italian restaurant in Tirana, which they opened in March 1994 after spending about $700,000 in renovation costs. Bardha's 13 McDonald's restaurants in the Detroit area gross a yearly $25 million. (Illyria) (Careful)

[8] Albania Amends Budget to Raise Workers Salaries

[9] Albania's unemployment higher, newspaper says.

[10] Albania's Commercial Bank and other banks to be privatized

[11] Italian officials discuss economic aid with Albanian President

[12] Albania is Arguably Post Communist Europe's Fastest Transforming Economy

The advisor, former university professor Mimoza Vokshi, says the free market transformation is gathering momentum. She says per capita income has more than tripled since 1992 to 700 dollars per year.

The economic growth figures have to be put in context. Albania is growing in part because of foreign assistance which since 1992 totals about two-billion dollars, and because of remittances from Albanians living outside the country. But the small business sector is vibrant and there is no doubt the economy is growing rapidly.

There are two ways to look at Albania. It is equally Europe's poorest economy and its newest. During the 50-years of communist dictatorship, Albania was essentially sealed off from the outside world. Miss Vokshi says Albania cannot afford to waste time.

Growth is not the only achievement. Inflation is down to under five-percent annually. The currency is stable against the dollar and has been for more than a year. Nonetheless, the economic condition of Albania is fragile, and with the general instability of the Balkans and parliamentary elections next year, the long-term future is difficult to predict.

Albania will continue to need foreign assistance for many more years. but the government has been successfully attracting small amounts of foreign direct investment, something it feels is far more useful than aid. Foreign investment was forbidden by law until the collapse of communism. Now Albania encourages investors allowing foreign firms to have complete ownership of local enterprises.

The first successful foreign investment was Coca Cola whose ten-million dollar bottling plant outside the capital is already a local landmark. Coca Cola is continuing to expand and more investments are in the works. There is also foreign interest in oil exploration and mining.

In the under developed tourism industry, Austria's Rogner hotel chain in a pioneer. Rogner recently opened a new hotel in Tirana and plans to develop a tourist resort on the southern Albania coast. Rogner has invested more than 20-million dollars in its Tirana hotel. It was assisted by the European Bank for Reconstruction and Development, the EBRD, which has a majority holding in the venture.

The marketing and sales manager for the hotel, Venera Cocoli, says it has been a challenge to train Albanians in the exacting standards of the western travel industry. Business people repeatedly say that the most difficult challenge in doing business in Albania is changing the mentality of the people. (??????)They are, say several foreign managers, not used to working a regular eight-hour shift. There is little concept of service and the idea of the customer being the boss is difficult to understand.

And yet, the foreign businesses have considerable praise for the Albanians. They says Albanians are quick to learn and responsive to increased responsibility and respectable wages.

[13] Albania -- Europe's poorest country -- is in the midst of an economic boom, a

In the early part of this century, Henry Ford was asked why the automobile was such a success. Puzzled, Mr. Ford replied, because people want to get up off the ground and ride.

In Albania where private cars were against the law until 1990, people are putting their bicycles and horse carts aside and getting into automobiles. In the past three years, the number of cars in Albania has tripled. More than 50-thousand vehicles -- most of them used -- are being imported each year. Outside the capital, horse carts and bicycles are still more numerous than cars. But in Tirana, motorized traffic has quickly emerged as a serious problem.

Approaching Tirana from the air, it is noticeable most of the roads in this mountainous land are not paved. Only one-third of Albania's eight-thousand kilometers of primary and secondary highways are paved. Health, telecommunications, education, water, power, and highways are the principle development priorities in this country.

In the transportation sector, modernizing the main north-south road from Greece to Tirana and the east-west highway from Macedonia to the Adriatic sea are top priorities. Meanwhile, in the capital, traffic control, driver education, and vehicle maintenance are major concerns.