Fact-sheet 6 - Albania - 8140-01/2010
1.4
Status and trends in the standard of living
Albania is now a middle‐income country that has generally been able to maintain positive growth rates and financial stability, despite the ongoing economic
crisis in Europe. Before the global financial crisis, Albania was one of the fastest‐growing economies in Europe, enjoying average annual real growth rates of
6%. In the aftermath of the global financial crisis and the overall macroeconomic situation associated with low growth rates since 2008, poverty in Albania
has increased. The fraction of the population whose real per capita monthly consumption is below the minimum standard of Lek 4891 (app 35 Euros)
increased from 12.5 % in 2008 to 14.3 % in 2012. Extremely poor population, defined as those with difficulty meeting basic nutritional needs, increased from
1.2% in 2008, to 2.3% in 2012. In addition, a shift of poverty from rural to urban areas is observed. Unemployment stands at 16.9% (2013) with youth
unemployment stands at around 26% and is a real challenge for the country.
Albania’s labor market has undergone some dramatic shifts over the last decade, contributing to productivity growth. Formal non‐agricultural employment
in the private sector more than doubled between 1999 and 2013, fueled largely by foreign investment. Emigration and urbanization brought a structural shift
away from agriculture and toward industry and service, allowing the economy to begin producing a variety of services ‐ ranging from banking to
telecommunications and tourism.
Despite this shift, agriculture remains one of the largest and most important sectors in Albania. Agriculture is a main source of employment and income –
especially in the country’s rural areas – and represents around 20% of GDP while accounting for about half of total employment. Albania’s agricultural
sector continues to face a number of challenges, however, including small farm size and land fragmentation, poor infrastructure, market limitations, limited
access to credit and grants, and inadequate rural institutions.
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1.5
Access to energy and resources
Albania has repeatedly incorporated the need to address energy issues in various strategies, assessments and reports that focus on socio‐economic
development and poverty reduction. For example, effort has been made to expand the market share of LPG as an alternative to electricity and fuelwood for
space heating and cooking. LPG has the advantage of being more reliable in terms of supply, as well as more flexible and cleaner to use. However, it is still
relatively expensive and not widely available in the country. Low energy efficiency, poor economics of fuelwood use, and a lack of rigorous forest
management practices are leading to unsustainable dependence on this renewable resource by a large portion of the Albanian population.
At the end of 2014, Albaniaʹs power regulator ERE raised the price of electricity for businesses and scrapped its cheaper rate for households on Friday to
help companies in the sector pay off debt to meet criteria set by international lenders. The electricity price for businesses was raised and the two‐tier system
for residential energy use was abolished. Social programmes that can support energy efficiency are in discussion i.e. installation of thermal insulation in
buildings and efficient wood stoves in households could serve to sustainably reduce energy consumption and energy bills, while also improving living
standards.
See list of documents
1.6
Awareness and action (political and civil society) to mitigate
climate change and to adapt to it
Albania does not have a national climate change strategy to address mitigation and adaptation challenges. Nevertheless, the climate change issue has been
integrated into several strategic documents: the NSDI (2007‐2013) and the 2009 Policy Paper for Carbon Finance. Albania ratified the Kyoto Protocol to
UNFCCC in 2004 and is eligible for the application of one of the Protocol’s mechanisms – CDM. Memoranda of understanding and agreements for carbon
funding have been signed with the Governments of Italy and Denmark. A portfolio of 11 CDM projects was identified under the Memorandum of
Understanding with Italy and feasibility studies were launched. Other CDM‐related agreements were concluded with the World Bank Bio‐Carbon Fund and
the Austrian Cooperation Agency.
Albania is experiencing certain vulnerabilities in terms of climate change. Higher air temperatures and frequent floods are reported in both the northwestern
and southwestern plains. The World Bank estimates that summer rainfalls will decline by about 10% by 2020 and 20% by 2050 with a large impact on
hydropower production as well as agriculture.
The total GHG emissions of Albania were 7,834 kt of CO2 in 1990, 7,620 kt in 2000 and were projected to be between 11.000 and 12.000 kt in 2012. Currently
Albania is a low emitter of greenhouse gases with 3.5 tons per capita compared to EU 9.9 tons per capita but they are projected to increase in the coming
years (mainly from transport followed by agriculture and waste sector).
Albania associated itself with most of the formal EU positions in Climate Change in the international context. It has associated with the Copenhagen Accord,
but it has not yet put forward a mitigation commitment by 2020. In line with its commitment a list of sector NAMAs (in line with EU sector approach) are
prepared two of which are in the process of registration as country’s voluntarily commitments towards UNFCCC and EU climate policy: (i) Implementation
of the National Energy Efficiency Action Plan in the residential, public and commercial sector; and (ii) Fuel switch/using of non‐hazardous waste as fuel in
the cement industry.
A policy document on ‘Climate Change adaptation’ is prepared guiding the strategic planning related to climate change adaptation. Climate change
adaptation measures are being introduced in Drini Mati River Deltas through a UNDP intervention.
See list of documents
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