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Socio-economic profile

With its economy growing at a good rate between 2000 and 2010, and poverty levels being cut by more than half in approximately the same period, Albania is holding its own in a financially turbulent world.

However, the country has faced very real challenges. A Ponzi scheme crash in 1997 caused losses equivalent to half the country’s entire GDP and in the 1990s, the influx of Kosovan refugees put a strain on the society.

Against a background of a fragile democracy and a conflict-ridden political scene, social protection isn’t meeting people’s needs. This has lead to a widening gap between people facing social challenges and the rest of society.

Finding work

Unemployment figures are hard to interpret as villagers who own a piece of land are counted as employed. But in most cases the small plots of land are left fallow, some providing vegetables for the family table and no more, meaning family members are looking for work. Since 48% of Albanians live in the countryside, unemployment is certainly higher than the official statistics state.

The country’s young people were born in the late 80s, early 90s, a particularly turbulent time. Many dropped out of education and are now not qualified enough to find a job – almost 57% of young people work, unpaid, for family members. Women do less well than men in the labour market: just over 28 % of women have work while for men that stands at 37.8%.

As is the case with other countries in the region, Albania has a large informal economy ranging from 30% to 60% of its GDP. Observers say the country is doing its best to cut back the informal economy but add that enforcement is weak.

Targeting support in Albania

To help countries on their way to joining the EU, a fund called the Instrument for Pre-accession Assistance, or IPA, has been created by the European Commission. One of IPA’s key goals is to prepare countries to run the programmes which, when they join the EU, will receive support from funds such as the European Social Fund (ESF).

Training up tomorrow’s labour force

Although major reforms to high schools and universities are being carried out, only 3.05% of GDP was spent on education in 2010. This is much lower than other fast-growing economies. Only half of all children go to pre-school and schools have a three-shift system where pupils in a shift only get two and a half hours of classes in a day. Between 1990 and 2000 the percentage of people signing up for vocational training shrank from 72% to 13%.

IPA – support where it is needed

The Instrument for Pre-Accession Assistance (IPA) supports the candidate and potential candidate countries to develop in a way that tackles social challenges and benefits the entire society. It is based on the strong sense of solidarity that exists between the EU and the countries at its borders - countries with which the EU shares enduring commercial, historical and cultural ties. IPA is directed towards countries that are on the pathway towards joining the EU.

From 2007 to 2010 IPA funding in Albania actively supported key areas linked with developing the country’s human resources:

  • Education and training received €9.2 million;
  • Social inclusion received €1.5 million;
  • Gathering accurate statistics to work out where help needs to be targeted received over €10.8 million

Financial Plan

Between 2007-2011, €345 245 790 was set aside for IPA funding in Albania. Here is how that was distributed, in euros.






49 268 790

60 917 000

69 860 000

83 200 000

82 000 000