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The Republic of Albania holds a strategic location in Southeast Europe, stretching over the Adriatic and Ionian peninsula. Its location along the coastline serves as a gateway to the region. Its bordering neighbors Kosovo, North Macedonia, Montenegro and Greece, enjoy full access to the Adriatic sea through Albania’s major sea ports.
Albania’s economy has experienced huge improvements over the last decades. Due to its positive economic growth, the country has improved its overall rank and has become a middle-income country, offering plenty opportunities for foreign investmentors. Also, the growth and improvement in terms of exports and infrastructure, have largely contributed to the overall economic growth. The macroeconomic situation is characterized by stable prices and low inflation rates.
The labor market in Albania is considered highly competitive in terms of costs and skills. Having around 60 percent of the population under the age of 35 and a relatively large number of graduates each year, Albania is surely a destination to be on foreign investors’ radar. The wages are among the lowest in the region. An avergae wage of 400 Euro per month and income taxes ranging from 0-23%, pose a great cost-effective opportunity for foreign businesses interested to shift their operations in Albania. Also, the Government of Albania has established vocational training programs equipping the labor force with the skills needed for the market and thus boosting private sector competitveness.
Despite the favorable labor market conditions, Albania also provides a welcoming and equal treatment for foreign investors. The current tax system is based on nondiscriminatory factors, providing equal opportunities for anyone interested in doing business in Albania. Specifically, the corporate income tax is 15% and the standard value added tax is 20%. In addition to the favorable tax rates, the country offers tax incentives and exemptons to attract foreign investors.
Albania’s numerous reforms, have enabled the establishment of a proper infrastructure for establishment of foreign businesses. Via an online platform, the interested foreign businesses can register a business in Albanian within 4 days.
In terms of trade, Albania has signed several trade agreements that enable a customs free access of Albanian goods and services into some of the largest European countries. The country is also part of the CEFTA agreement signed between Bosnia and Herzegovina, Croatia, Kosovo, Moldova, Montenegro, North Macedonia, and Serbia aiming at promoting investments, expanding trade of goods and services and eliminating trade barriers.
Albania has done many reforms in improving its infrastructure for attracting foreign investors and boosting the economic activity. A detailed snapshot of Albania’s current business infrastructure and environment, is provided in the brochure “Investing in Albania”.