Since 2008, Albania has seen an increase in the national poverty level and remains one of the poorest countries in Europe.
The Statistics Institute of Albania (INSTAT) recently reported that this increase has largely been due to the global economic crisis, especially now since that Albania is no longer the centralized, state-run economy it once was. Due to relatively low rates of growth from 2008, Albania has found itself struggling economically, with many people blaming the global economic crisis, especially economic crises in neighboring countries like Greece and Italy.
Despite the economic growth Albania, a country with a population of only 3 million, has undergone under its free market economy, nearly one-fourth of the population still lives in poverty.
Even though Albania saw a decrease in extreme poverty between 2002 and 2005, poverty has actually risen 1 percent from 2008 to 2012. While both urban and rural areas have seen similar percentage increases, a little over 2 percent, some highly populated regions have experienced vast increases.
For example, Tirana, the capital of Albania, has experienced a nearly 5 percent increase in poverty. After the end of communism in Albania, many state-owned industries closed, and many people found themselves struggling with unemployment.
As a relatively new free market, the Albanian economy is not apt to deal with macro-economic slowdowns. The worldwide economic crisis further exacerbates the troubles many smaller-scale farmers have in finding outlets to sell their products. In a globalized, hyper competitive world, there is little hope for products that struggle to pass international hygiene and safety standards.
Albanian productivity is also hindered by lapses in technical expertise and industrial innovation, having to compete with international corporate giants. The lack of markets, foreign investments, other vital financial services, make these poor economic conditions even more precarious.
In June, after a landslide election, Albania’s new prime minister, Edi Rama, promised to fight these economic troubles and pledged to create 300,000 jobs for Albanians. The socialist prime minister’s hope is to fight poverty, corruption, and unemployment to win Albanian membership into the European Union.
– Rahul Shah