Economic Indicators
Inflation remained subdued, averaging 2.4 percent for 2006. According to BoA the controlled inflation was also supported by low oil prices at the second part of the year that helped reducing the costs of production and transport. The decline in food and agricultural products prices weakened the overall increase in prices during the first half of the year despite upward pressures on prices from rents and utilities. The Lek also contributed somewhat to low inflation levels even though its appreciation trend went downward in 2006.
Capital investments realized below the planned levels coupled with the serious electrical power shortages during Q4 negatively impacted the economic growth rate and restrained economic activities. However, according to Bank of Albania, the economy grew in real terms in 2006 by 5.0 percent, less than the forecasted level.
Table 1
|
2002 |
2003 |
2004 |
2005 |
2006 |
|
|
|
|
|
|
Nominal GDP ALL (Bn) |
624.7 |
682.7 |
766.4 |
836.8 |
896,3 |
Nominal GDP USD (Bn) |
4.459 |
5.600 |
7.455 |
8.385 |
9.136 |
Nominal GDP/Capita (USD) |
1,441 |
1,800 |
2,427 |
2,674 |
2.855 |
|
|
|
|
|
|
Growth Rate (%) |
Real GDP |
2.9 |
5.7 |
5.9 |
5.5 |
5.0 |
Retail prices (avg.) |
5.2 |
2.4 |
2.9 |
2.4 |
2.4 |
Retail prices (end of period) |
1.7 |
3.3 |
2.2 |
2.0 |
2.5 |
|
|
|
|
|
|
Savings-Investment Balance (in % of GDP) |
Foreign Savings |
7.2 |
5.5 |
3.8 |
5.5 |
5.8 |
Domestic Savings |
17.4 |
17.9 |
20.0 |
18.6 |
19.2 |
-Public |
0.0 |
-0.1 |
0.1 |
1.4 |
2.4 |
-Private |
17.4 |
18.0 |
19.9 |
17.2 |
16.8 |
Investment |
24.5 |
23.4 |
23.8 |
24.2 |
25.0 |
-Public |
6.7 |
4.6 |
5.0 |
5.2 |
5.6 |
-Private |
17.8 |
18.8 |
18.8 |
19.0 |
19.4 |
Source: Bank of Albania, IMF, Ministry of Finance
The following table presents the origins of the Albanian Gross Domestic Product through the years.
In % of Total Table 2
|
2002 |
2003 |
2004 |
2005 |
2006* |
|
|
|
|
Industry |
10.8 |
13.0 |
13.5 |
9.5 |
10.1 |
Agriculture |
26.3 |
24.0 |
23.4 |
21.9 |
21.5 |
Construction |
7.9 |
8.1 |
8.5 |
16.5 |
17.3 |
Transport |
11.2 |
12.1 |
8.9 |
7.8 |
8.0 |
Other Services |
43.6 |
42.8 |
45.7 |
44.3 |
43.1 |
Source: Bank of Albania – 2006. *Preliminary data.
Trade
Albania has joined the World Trade Organization in September 2000 and is currently implementing its tariff reductions schedule. According to the Albanian Center for International Trade (ACIT), the trade-weighted average import tariff has been eased from 15.3 percent in 1998 to 11 percent in 2000 and 7.41 percent in 2006.
Albania has also signed Free Trade Agreements with eight South-Eastern European countries.
Table 6
Principal exports 2006
|
% of Total |
Principal imports 2006 |
% of Total |
|
|
|
|
Textiles & footwear |
54.7 |
Machinery |
20.2 |
Building materials |
16.8 |
Food, beverages & tabacco |
17.9 |
Food, beverages & tobacco |
7.9 |
Building materials |
16.0 |
Minerals, fuel & electricity |
7,6 |
Minerals, fuel & electricity |
13.9 |
Machinery |
3.9 |
Textiles & Foodwear |
11.7 |
Source: The Economist Intelligence Unit
Geography of Trade in 2006
The following table presents the pattern of trade activity by region and country in 2006. (Table 7)
Table 7
Partner Countries |
Exports |
Imports |
Trade Balance |
Amount |
% |
Amount |
% |
(ml USD) |
(ml USD) |
of Total |
(ml USD) |
of Total |
|
|
|
|
|
|
|
EU – 25 |
696.43 |
88 |
1,913.90 |
63 |
-1,217.47 |
Germany |
25.09 |
3 |
142.01 |
5 |
-116.92 |
Greece |
75.22 |
10 |
512.05 |
17 |
-436.83 |
Italy |
574.57 |
73 |
883.46 |
29 |
-308.89 |
Austria |
2.24 |
0 |
61.24 |
2 |
-59.00 |
France |
5.54 |
1 |
27.09 |
1 |
-21.55 |
Other EU |
13.78 |
2 |
288.08 |
9 |
-274.30 |
SEE Countries |
64.18 |
8 |
205 |
7.9 |
-140.82 |
UNMIK-Kosovo |
13.15 |
4 |
11.2 |
0.4 |
1.95 |
FYROM |
12.64 |
2 |
39.5 |
1.5 |
-26.86 |
Serbia & Montenegro |
10.82 |
1 |
22.1 |
0.9 |
-11.28 |
Croatia |
2.26 |
0 |
26.3 |
1 |
-24.04 |
Bulgaria |
3.28 |
0 |
80.9 |
3.1 |
-77.62 |
Romania |
0.65 |
0 |
20.8 |
0.8 |
-20.15 |
Bosnia and Herzegovina |
4.36 |
1 |
3.3 |
0.1 |
1.06 |
USA |
3.44 |
0 |
23.3 |
0.9 |
-19.86 |
China |
9.16 |
1 |
149.2 |
5.7 |
-140.04 |
Turkey |
9.99 |
1 |
193.8 |
7.4 |
-183.81 |
Source: Albanian Center for International Trade
As it was the destination of 88 percent of exports and 63 percent of imports, the European Union is the main trading partner of Albania. Italy and Greece, Albania’s most important trading partners generated 83 percent of the total exports and 46 percent of the imports.
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