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Key Economic Data 
  2003 2002 2001 Ranking(2003)
Millions of US $ 6,124 4,695 4,100 109
GNI per capita
 US $ 1,740 1,380 1,340 120
Ranking is given out of 208 nations - (data from the World Bank)

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Alfred Moisiu

Update No: 105 - (30/01/06)

A tough year ahead
After the political turbulence and drift associated with an election year, Albania should enjoy a much greater sense of purpose in 2006. However, Prime Minister Sali Berisha has strong ambitions for the local elections, and with a highly effective new opponent in Socialist leader Edi Rama, the electoral campaign could turn into a tough fight. That, in turn, may strain the otherwise increasing sense of political stability.
Berisha, no doubt to his great delight, has seen off his long-time opponent, Fatos Nano, who resigned the leadership of the Socialist Party of Albania after eight years in power (1997-2005) on defeat last summer in July. But Rama, the mayor of Tirana, is a tough replacement to face. He is riding high in the polls, especially in the capital.
For those old enough to remember the days of Enver Hoxha, for decades dictator of the small, obscure republic, it is still a miracle that the Albanians are having a say in who rules over them. Long may it last.
But the form democracy should take is still in dispute.

Ruling party against presidential elections by popular vote
The presidency counts as well as the premiership in Albania's fledgling democracy. The ruling Democratic Party of Albania rejected the motion tabled by the opposition, proposing presidential election by popular vote, instead of vote in the parliament, Makfax reports from Tirana.
The President of the Albanian Assembly Jozefina Topali said the Socialists' proposal is unacceptable, because no international organization has put forward such a request thus far. The ruling party reckons that the ambitions of the Socialists' leadership stand behind the proposal.
Albania is due to elect a new president in 2007. The incumbent president Alfred Mojsiu hopes for another term, reported Tirana's media.
Albanian analysts pointed out that the Socialists' proposal is related to the mildly improved approval ratings of the opposition, and particularly of their new leader Edi Rama. The latest opinion polls indicated that the new leader of the Socialists and incumbent Mayor of Tirana, Edi Rama, was the most popular person in Albania in 2006.
Nevertheless, newly elected Albanian Prime Minister Sali Berisha has committed his government and the Democratic Party to completing electoral reform as soon as possible. "The government is committed to undertaking every action, in cooperation with the local government, for an open and transparent process of preparing lists," said Berisha, speaking on January 9th.

The EU is still far off
In its latest Progress Report, the European Commission assessed Albania, especially in terms of the legislative and institutional progress and the country's administrative capacity. The conclusion was that Albania has made sufficient headway in order to implement a Stabilization and Association Agreement, the stepping-stone to EU candidacy status.
Still, EU Enlargement Commissioner Olli Rehn, speaking to the Albanian Parliament after issuing the report, warned of the need to fight against corruption. "Albania must show results in fighting corruption," Rehn warned Albanian deputies.
"Cases must be dealt with firmly, but strictly according to the rules, and independently of party affiliation. This is important because Albania needs to improve its administrative capacity in order to implement the Stabilization and Association Agreement properly," said Rehn.
Albania remains low on the list of potential EU candidates. International perceptions of Albania, especially with respect to corruption, organized crime and political culture are far from good.
One of the first tasks of Berisha's administration will be to improve the electoral system. All free elections held since the regime change have been contested. The outgoing Socialist party also contested last July's elections. 
Berisha believes there is now a consensus. "Proposals made by OSCE and ODIHR create the basis. We started a parliamentary commission for the electoral reform," he said.

World Bank to loan Albania US$196M over next 4 years 
The World Bank said on January 11th that it would loan Albania US$196 million over the next three years to help fight poverty, high unemployment and wide regional economic disparities. 
The bank's board of directors discussed assistance for the tiny Balkan country until 2009, the World Bank said in a statement. 
The new aid for Albania, one of Europe's poorest countries, will include loans of US$86 million from the International Development Association and US$110 million from the International Bank for Reconstruction and Development. 
The funding will aim to help stimulate economic growth by supporting private sector development and improving social services. 
The plan is the bank's fourth aid program for Albania, whose gross domestic product grew an estimated 5.5% in 2005 and is projected to grow 5% this year. 
"However, maintaining this performance will be difficult, and Albania will need to attract more foreign direct investment, increase public and private savings, accelerate accumulation of physical and human capital, and improve governance structures to maintain its impressive progress to date," the statement said. 
Since 1991, the World Bank Group has been one of the main financiers for post-communist Albania with up to US$953.6 million of aid. 
Recently, Albania also signed a draft agreement with the International Monetary Fund, which was expected to be approved later in January by the agency's executive board. 
"Performance in improving the fiscal administration and the revenue collection are the foundation of our promises (for this deal)," Prime Minister Sali Berisha said. 
An IMF mission visited Tirana last year to reach understanding on key reforms to Albania's management of taxes, customs, market development, public debt and spending. 
The IMF praised Albania's efforts in keeping inflation down and maintaining growth, but encouraged the country to do more to fight corruption and improve governance. 
The previous three-year, US$42.7 million Poverty-Reduction and Growth Facility program began in June 2002 and expired in November 2005. 

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Albania to subsidise diesel fuel cost for farmers

According to Albania's agriculture ministry US$3 million will be earmarked to subsidise purchases of excise duty-free diesel fuel for domestic farmers. The subsidies will cover the difference between the price of 40 leks (US$0.3913) per litre, at which the diesel fuel will be supplied to farmers, and the 65 leks per litre, at which state-owned oil refinery ARMO sells the fuel, Agriculture Ministry spokesman, Rexhep Shahu, said, New Europe reported.
Beneficiaries of the subsidies are farmers using agricultural machines, running greenhouses and dairy processing lines. The centre-right coalition government, led by Sali Berisha, has alleged that some 11 million litres of excise-free diesel fuel had been distributed outside target groups prior to the elections. Since then, the government has introduced a new distribution scheme aimed at avoiding abuses. Agriculture contributes around 25 per cent to Albania's gross domestic product. The government has allocated 4.7 billion leks in spending to the sector in the 2006 draft budget.

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Central bank of Albania issues license 

The Central Bank of Albania issued its final banking license to Union Bank on December 30th 2005, which becomes the country's third private bank, New Europe reported.
Union Bank received a preliminary license in February 2005 and since then it has completed its infrastructure and legal procedures of registration, nominated administrators and deposited the initial capital, according to a statement of the central bank. All commercial banks are required to have a basic capital of 1 billion leks (US$10.1 million). Sixteen other commercial banks, two Albanian and 14 foreign are operating in the country.

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Albania holds tender for electricity in 2006

Albania held an international tender on December 19th to buy electricity for this year to solve the power crisis that has caused power cuts across the country, the power corporation said, New Europe reported.
Seven companies from Switzerland, Slovakia, Czech Republic, Macedonia, Britain and Albania presented their bids to supply the electricity requested by the state-owned KESH power company for 2006.
Since November KESH has scheduled daily power cuts to all Albania's consumers, except for hospitals, water supply stations, police and emergency services and foreign embassies, after its production dropped drastically when main hydropower stations, built along the Drini river, failed as drought earlier last year led to a lack of water.
The KESK officials said they ended some time to announce the winning bid.

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Albania signs new agreements with IMF, WB

As a previous World Bank loan of US$130m did not produce the expected results, particularly in improving governance now the World Bank announced a loan of US$196m until 2009, New Europe reported.
The Albanian government signed a draft three-year agreement with the IMF on January 11th. The deal sets out a number of guidelines for Albanian institutions, including setting a realistic budget and threshold for tax collections, as well as improving control over expenditures. The IMF Board if expected to approve it on January 27th. Prime Minister, Sali Berisha, said at the signing ceremony, "I am pleased to notice that during these months, developments are on the right track to guarantee macroeconomic stability and stable development. It is also important to implement, in the second half of the year, a fiscal package which will encourage the economic growth and employment for Albanians."

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Mobile Communications installs BSCS 8 from LHS

A subsidiary of the leading Greek mobile operator COSMOTE, Albania Mobile Communications (AMC) has installed its BSCS 8 billing and customer care solution from LHS. The promotional offers and special tariffs can now be rolled out across both pre- and post-paid customers with this installation. The newly installed billing system will allow AMC to effectively support recently launched GPRS services such as wireless Internet and MMS. SCS 8 delivers end-to-end content charging from the network and application interaction through to the billing and partner settlement across all mobile, fixed and IP networks, New Europe reported.
AMC will now be offering its customers continuous connection to the Internet without subscription to an Internet service provider. "BSCS 8 has proven to be a real-time, very flexible and open system at COSMOTE Greece, thus fulfilling important requirements for AMC, the leading operator in Albania, while at the same time reducing total operational expenses of billing for the whole COSMOTE Group," commented Christos Christopoulos, COSMOTE IT director. "We are the first operator in Albania to offer internet services via mobile phone and it is very important to us and our customers that the billing system allows for the quick launch of new services in order to keep our strong competitive advantage. BSCS will support us with the bundling of voice, data and content services and help us to further differentiate from competition with complex and integrated marketing campaigns," Detlef Purschke, Division Officer Europe, LHS added: "We specifically designed BSCS 8 to allow flexible billing for operators."

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