Just opposite the Italian coast and between the famed beaches of Croatia and Greece, Albania is marketing itself as a unique and undiscovered destination in the Mediterranean. With beautiful coastlines, snow-capped mountains and stone castles steeped in history, this small country has much to offer, but it has yet to make it onto most people’s bucket list.
After 50 years of communist isolation and subsequent political and economic uncertainty, the country is only recently becoming a destination for international travelers. International tourism is a relatively new industry in Albania and many attractions are underdeveloped, hospitality services are often informal and road travel throughout the country can be slow and difficult. Furthermore, Albania is poorly connected to the region, with a limited number of direct flights and no charter airline services.
Yet the country is brimming with potential and the current government has identified tourism as a key sector for economic growth. “The tourism sector is perceived to be a priority for several different parts of the government,” explains Mejvis Kola (Bajollari), Minister Advisor on Tourism Issues. “It has great potential to attract foreign investments, create jobs, and support inclusive economic growth.”
CID is working with the Ministry of Urban Development and Tourism to understand the challenges unique to the tourism sector in Albania and to begin to develop tailored economic growth strategies. As part of this process they helped form a “Black Belt Team” (BBT) coordinated by Ms. Kola and comprised of key staff from within the Ministry. This team, in consultation with the private sector and with other ministries and government agencies, is currently developing an incentive package to promote growth and increase investment in tourism.
To better understand the Albanian context and bring insight from the region, the BBT has conducted research on how the country is positioned in relation to its regional peers. “Some preliminary data highlights infrastructure (air, ground, tourism) and the quality of human capital as the lowest ranking aspects of tourism in Albania,” explains Karina Baba, a Harvard master’s student working with CID’s Economic Growth in Albania project. To address these problems, the BBT is looking into ways to mobilize private and public investments in the sector and has proposed the inclusion of measures for establishing licensing, certification and training for tourism professionals and agencies into the tourism package.
While tourism is a priority across the government, the team has a difficult job. Tourism development is coordination intensive – it depends on simultaneous implementation of actions and policies across various parts of the government. Any fiscal incentives included in the package need to be coordinated with the Ministry of Finance, among others. Promoting destination-specific tourism development involves tackling the issue of unclear land ownership across the country (a legacy of the former communist system), which involves the Ministry of Defense, Ministry of Infrastructure, and more.
The Tourism BBT is therefore in a crucial position to build communication and coordination across the government. The Ministry has already made significant progress by proposing a new Law of Tourism, which is currently pending approval, and the tourism development package aims to bring more opportunities for growth to the sector.
With 80 percent of hotels having only 20 to 40 rooms and unpaved roads leading to many of the country’s key attractions, Albania still has a long way to go to becoming a competitive tourism destination in the Balkans. However the potential for economic growth and employment through tourism is high. CID is supporting the Ministry’s efforts to tackle these challenges in collaboration with key government actors and ensure growth is sustainable over the long term.
About the author: Karen Vanderwillik is a summer intern for the Economic Growth in Albania project.