ALB Albania profile

Albania operates as a parliamentary republic with coalition politics. Governance is characterized by reform efforts aimed at strengthening the rule of law and public administration, yet corruption and influence of organized crime legacy persist in some sectors. The judiciary remains under reform pressure, with misgivings about independence and efficiency, and judicial capacity varies across regions. Public administration shows attempts at modernization, but capacity and pay structure create incentives for bureaucratic delay. Media environment is active and diverse, though political pressures and ownership concentration can affect editorial independence. Local governance and decentralization progress uneven, with meaningful differences in service delivery between urban and rural areas. The policy landscape is shaped by the prospect of closer European integration and alignment with EU norms, which remains a powerful but slow-driving force.

Colonial history None, historically influenced by various empires
Former colonizer N/A
Government type Parliamentary republic
Legal system Civil law system
Political stability Moderate

The economy is in transition toward a market orientation with a strong service sector footprint, including tourism and public services, and with energy and construction as notable sectors. Private enterprise shows resilience but faces constraints from administrative hurdles, regulatory instability, and corruption perceptions. A sizable informal economy persists, limiting tax revenue and formal planning. Remittances from diaspora underpin household consumption and some growth, while foreign investment concentrates in energy projects, tourism, and infrastructure. Agriculture remains important for employment and rural livelihoods but productivity lags behind urban demand. Energy sector relies on hydropower and lignite, with diversification and reliability issues shaping investment climate. The external sector is influenced by trade patterns and regional integration, but domestic productivity and innovation capacity require strengthening.

Currency name Lek
Economic system Mixed economy
Informal economy presence Considerable
Key industries Tourism, Agriculture, Textiles, Mining
Trade orientation Export and import-oriented economy

Albania sits along the Adriatic and Ionian seas, with a long coastline and mountainous interior that shape development possibilities and risk profiles. Seismic activity is a constant concern, affecting building standards, urban planning, and disaster preparedness. The country hosts diverse ecosystems, including coastal habitats and forests, but faces pressures from development, pollution, and unsustainable resource use. Waste management and water quality present ongoing challenges, particularly in urban centers and rivers. Climate vulnerability intersects with agriculture and tourism, underscoring the need for resilience planning. Protected areas and conservation policies exist, yet enforcement and funding gaps limit their effectiveness.

Bordering countries Montenegro, Kosovo, North Macedonia, Greece
Climate type Mediterranean
Continent Europe
Environmental Issues Deforestation, Air pollution, Water pollution
Landlocked No
Natural Hazards Earthquakes, Floods
Natural resources Bauxite, copper, chromite, iron, natural gas, timber, hydropower
Terrain type Mountains and plains

Population decline and youth outmigration influence demographic and labor market dynamics, with urban centers attracting talent while rural areas face neglect. Access to quality education and health services varies by region and socioeconomic status, influencing social outcomes. Inequality persists across income, geographic, and ethnic lines, with social protection systems under pressure from demographic change. Small minority communities and linguistic groups are present, with ongoing integration considerations and rights protections. Gender equality progress is noted, though violence against women and barriers to participation in public life and the economy remain concerns. Civil society and local initiatives provide social cohesion and accountability, but political polarization at times undermines consensus on reforms.

Cultural heritage Rich heritage including Byzantine, Ottoman influences, UNESCO sites
Driving side Right
Education system type Public and private schools, higher education institutions
Ethnic composition Albanian, Greek, Macedonian, Serb, Romani
Family structure Extended family with strong kinship ties
Healthcare model Socialized healthcare system with private healthcare options
Major religions Islam, Christianity
Official languages Albanian

Transport networks show improvement in ports and roads, yet bottlenecks remain for nationwide connectivity and regional integration. Rail infrastructure is limited, constraining freight and passenger movement. Energy infrastructure is undergoing modernization, with investments in grid upgrades and renewable potential, though reliability and cross-border energy exchange require ongoing attention. Digital infrastructure is expanding, with rising internet and mobile access and growing e-government services, but rural connectivity gaps persist. The business environment benefits from IT and outsourcing potential, but talent retention and skills development are essential to sustain technology-led growth. Innovation policy exists, but practical implementation and funding for research and start-ups need strengthening.

Internet censorship level Low
Tech innovation level Developing
Transport system type Road, rail, and air transport

Development indicators

Indicator Year Value Rank 5Y Rank Change
Military expenditure (current US$) 2023 397,617,613 103 -14
Political Stability and Absence of Violence/Terrorism 2023 0.183 91 +13
Regulatory Quality 2023 0.172 79 +8
Rule of Law 2023 -0.164 107 -17
Unemployment, total (% of total labor force) 2023 10.7 10 -9
Birth rate, crude (per 1,000 people) 2023 10.2 154 -4
Death rate, crude (per 1,000 people) 2023 8.33 64 -30
Exports of goods and services (% of GDP) 2024 36.1 69 -44
GDP per capita (current US$) 2024 10,012 82 -39
GDP per capita, PPP (current international US$) 2024 23,488 81 -23
High-technology exports (current US$) 2023 16,899,736 105 -40
Imports of goods and services (% of GDP) 2024 43 64 -19
Inflation, consumer prices (annual %) 2024 2.21 105 -17
Life expectancy at birth, total (years) 2023 79.6 53 +2
Mortality rate, under-5 (per 1,000 live births) 2023 9.4 113 -6
Net migration 2024 -24,472 176 +7
Patent applications, residents 2021 23 82 0
Population, total 2024 2,714,617 142 +5
Prevalence of undernourishment (% of population) 2022 4.5 78 0
Renewable energy consumption (% of total final energy consumption) 2021 41.9 53 -3
Foreign direct investment, net inflows (% of GDP) 2024 6.31 17 -6
Current account balance (% of GDP) 2024 -2.38 75 -74
Level of water stress: freshwater withdrawal as a proportion of available freshwater resources 2021 4.78 125 +17
Total greenhouse gas emissions excluding LULUCF per capita (t CO2e/capita) 2023 2.79 129 +8
Current health expenditure (% of GDP) 2022 6.19 102 +15
Domestic general government health expenditure per capita, PPP (current international US$) 2022 536 96 -5
Suicide mortality rate (per 100,000 population) 2021 2.75 153 +11
Individuals using the Internet (% of population) 2023 83.1 61 -10
Logistics performance index: Quality of trade and transport-related infrastructure (1=low to 5=high) 2022 2.7 19
Control of Corruption 2023 -0.332 106 -23
Government Effectiveness 2023 0.251 74 -10

Demography and Health

Albania's population in 2024 stands at 2,714,617, reflecting a mid-sized European country with a relatively favorable age structure. Life expectancy at birth is 79.6 years as of 2023, indicating solid health outcomes by regional standards and strong access to healthcare services. The birth rate is 10.2 per 1,000 people and the crude death rate is 8.33 per 1,000, signaling a modest natural rate of population growth. The mortality profile includes an under-5 mortality rate of 9.4 per 1,000 live births, which shows progress in child health but still leaves room for improvement relative to Western Europe. Unemployment is 10.7% in 2023, suggesting a labor market that is recovering but not fully tight. Net migration is negative in 2024, with outflows totaling about 24,472 people, a pattern that can affect future demographics and the composition of the labor force. In health financing, current health expenditure amounts to 6.19% of GDP in 2022, while domestic general government health expenditure per capita, PPP, is 536 International US$ in 2022, indicating a substantial but not overwhelming public investment in health services. Taken together, these indicators portray a country that enjoys strong life expectancy and improving health outcomes but faces ongoing challenges in employment, migration, and maintaining rising health system capacity.

Economy, Trade and Investment

Albania's economy displays a middle-income profile with GDP per capita at 10,012 current US$ in 2024 and GDP per capita, PPP at 23,488 international US$ in 2024, underscoring living standards that are rising when adjusted for purchasing power. The economy is open and integrated with global markets: exports of goods and services account for 36.1% of GDP in 2024 while imports absorb 43% of GDP, reflecting a substantial trade footprint but with a modest current account deficit at -2.38% of GDP in 2024. Foreign direct investment net inflows reach 6.31% of GDP in 2024, signaling a supportive, though not speculative, investment climate and ongoing integration into regional value chains. Inflation remains moderate at 2.21% in 2024, contributing to macro stability that supports planning for households and firms. The unemployment rate at 10.7% in 2023 indicates a labor market still recovering from shocks but showing resilience. Albania's high-technology exports stood at approximately 16.9 million US$ in 2023, and resident patent applications were 23 in 2021, illustrating a nascent but visible digital economy and space for growth in research and development. The renewal of investment and reform momentum is complemented by a renewable energy share of 41.9% of total final energy consumption in 2021, signaling a tilt toward cleaner energy sources that can reduce energy costs and bolster long-run competitiveness. Net migration outflows suggest that talent retention remains a policy challenge even as inward investment grows, shaping the country’s medium-term growth trajectory.

Governance and Institutions

Albania's governance indicators reflect a mix of strengths and persistent weaknesses. Political stability and absence of violence/terrorism register 0.183 in 2023, signaling relative resilience but limited assurance in a broader regional horizon. Regulatory quality is 0.172, indicating improvements in the business environment yet room to streamline regulations and reduce compliance burdens. The Rule of Law is negative at -0.164, pointing to concerns about the effectiveness of legal frameworks and judicial processes. Control of corruption is notably weaker at -0.332, highlighting continued challenges in anti-corruption efforts and governance credibility. Government effectiveness is positive at 0.251, suggesting that certain public services and policy implementations perform reasonably well. Collectively, these indicators show a governance trajectory that is advancing but requires sustained reforms to strengthen the rule of law, combat corruption, and enhance institutional performance. The quality of governance is consequential for attracting high-quality investment, implementing structural reforms, and advancing EU-aligned standards in areas such as regulation, property rights, and the rule of law.

Infrastructure and Technology

Albania benefits from strong digital penetration, with 83.1% of the population using the Internet in 2023, enabling e-government, digital commerce, and online services across society. On logistics, the Logistics Performance Index for quality of trade and transport-related infrastructure stands at 2.7 on a 1–5 scale in 2022, indicating moderate infrastructure quality with scope for improvements in transport efficiency, customs, and connectivity. Domestic innovation activity appears modest, with resident patent applications numbering 23 in 2021, while high-technology exports reach about 16.9 million US$ in 2023, underscoring that the country remains at an early stage of advanced-technology production and faces opportunities to scale up R&D and design activities. Albania's energy profile features renewable energy consumption at 41.9% of total final energy consumption in 2021, highlighting a meaningful shift toward cleaner energy sources that can reduce vulnerability to fossil fuel price swings and support sustainable growth. Taken together, Albania combines broad digital access with a mid-tier logistics framework and a nascent but growing high-tech export sector, indicating substantial potential for upgrading productivity through targeted investments in R&D, digital infrastructure, and supply-chain modernization.

Environment and Sustainability

Albania shows notable environmental progress and a trajectory toward sustainability. Renewable energy accounts for 41.9% of total final energy consumption in 2021, signaling a strong contribution of cleaner sources to the energy mix and potential for reduced emissions as the economy grows. Per capita greenhouse gas emissions excluding LULUCF are 2.79 t CO2e in 2023, which is moderate for a transitioning economy and provides room for continued decarbonization through energy efficiency, electrification, and renewable competitiveness. Level of water stress, measured as freshwater withdrawal relative to available resources, stands at 4.78% in 2021, suggesting manageable water usage pressures and a relatively moderate risk of water scarcity relative to larger regional players. The prevalence of undernourishment is 4.5% in 2022, indicating a reasonably sound nutritional outlook. Public health investment and clean-energy policies can help Albania advance toward more sustainable growth while protecting vulnerable ecosystems, with ongoing attention required to climate resilience, emissions reductions, and governance reforms to maximize environmental benefits across sectors.