The outside world sees a country committed to democratic change and newsweek has listed Albania as the best low income nation and describes it in complimentary terms: “this new democracy actually outperforms all the other low income countries – consistently ranks highest in education, health and quality of life.” Influential words which will bolster the confidence of investors.
There is no doubting Mr Berisha’s intent to open the country to
foreign investment and the ease of doing business there is a huge plus
for investors. Corporate and personal taxes capped at ten percent and no
restrictions on foreign investment make a good combination. The
rumblings of some of the population that things were better under
communist days are a result of transitional change as the country faces
rapid development. The move of many from rural life to urbanisation
provides for a cheap work force which in turn results in low cost
developments.
Albania desperately wants the additional kudos of joining the E.U.,
anticipated within the next five years. This almost guarantees the
safety of investment there as the government will do nothing to risk its
expected invitation. Five years should be ample time to see capital
growth on investment made now with an eye on the ball to exit the
country if the European merger does not materialise.
Foreign investment is split between Tirana and the coast with Tirana offering better long term prospects if the expected growth in tourism does not happen in coastal regions. It’s a gamble and portfolios could be split to minimise loss if the coast does not develop as well as the capital. Investment in Tirana offers more long term options with foreign businesses needing to rent for their employees and the expected continued migration to the capital from those Albanians currently outside the country. My instinct is towards the capital for lower risk with higher risk on the coast, with preference for off plan development at early stage on the coast and completed apartments in areas with good security in the capital.
by Efstathios Poulitsis
Source-Newsweek.
