Country Note Albania 2024

CELIS Country Note on Albania, 2024
by Elvis Zerva, CELIS Assistant Country Reporter for Albania

This Note provides background on the FDIs system in Albania and the prospects of adopting investment screening mechanisms as part of the country obligation to approximate its legislation with the acquis. Albania’s foreign trade regime was liberalized only in early 90s following the economic and geopolitical developments in the Eastern Europe that culminated with the fall of Berlin Wall. The approach of the FDIs legislation has been to promote openness towards foreign investments without prejudice to their country of origin, while envisaging only for few restrictions. FDIs have emerged as a vital component of the Albanian economy, playing a pivotal role in its growth, although impediments such as country’s low market size, lack of tradition to cope with FDIs, limited institutional resources to orientate FDIs and manage grievances. The current FDIs system lacks of a formal screening mechanism that enables the restriction or prohibition of FDIs with implications for security or public order. This situation is expected to change considering geoeconomics factors encompassing also Western Balkans and while Albania opened accession negotiations on July 2022. The challenge shall be to balance the appetite of the Albanian economy for more FDIs and the need to address national security and strategic interests.