Albania Economic Forecast

Albania Economic Outlook

May 12, 2020

January and February data paints a fairly positive picture, with exports recovering and tourist arrivals strengthening notably; however, the Covid-19 pandemic dealt a heavy blow to the economy in March, with tourist arrivals collapsing by over 60% year-on-year and exports dropping steeply as much of Europe went into lockdown. Worse is likely to come in the second quarter: The tourism sector will feel the full force of the European travel restrictions, while global trade remains severely depressed and domestic demand is being affected by containment measures at home. More positively, the government began gradually lifting some social distancing measures in late April, which should revive economic activity to an extent. In addition, Parliament approved in mid-April a second stimulus package with measures such as a EUR 55 million cash transfer scheme and EUR 119 million of loan guarantees.

Albania Economic Growth

The outlook remains dire, with the economy expected to contract for the first time in over two decades this year. Domestic and regional economic activity will be depressed due to Covid-19, hampering tourism, trade and household expenditure. Fiscal stimulus should soften the economic impact somewhat, but is unlikely to ward off an economic downturn. FocusEconomics panelists project the economy will contract 4.9% in 2020, which is down 3.8 percentage points from last month’s estimate. In 2021, the panel sees the economy growing 6.7% in 2021.

Albania Economy Data

2015 2016 2017 2018 2019
Population (million)2.92.92.92.92.9
GDP per capita (USD)3,9554,1414,6405,251-  
GDP per capita (EUR)3,5503,7284,0684,497-  
GDP (USD bn)11.411.913.315.1-  
GDP (EUR bn)10.210.711.712.9-  
Economic Growth (GDP, annual variation in %)2.23.33.84.1-  
Consumption (annual variation in %)1.11.92.33.2-  
Investment (annual variation in %)3.82.55.52.9-  
Unemployment Rate17.314.213.412.3-  
Fiscal Balance (% of GDP)-4.1-1.8-2.0-1.6-  
Public Debt (% of GDP)72.772.470.167.8-  
Inflation Rate (CPI, annual variation in %)1.91.32.02.01.4
Policy Interest Rate (%)1.751.251.251.001.00
Exchange Rate (vs USD)126.1128.3110.8108.1108.6
Current Account (% of GDP)-8.6-7.6-7.4-6.7-  
Current Account Balance (EUR bn)-0.9-0.8-0.9-0.9-  
Trade Balance (EUR billion)-2.3-2.6-2.8-2.9-  
Exports (EUR billion)0.80.70.81.0-  
Imports (EUR billion)3.13.33.63.9-  
Exports (annual variation in %)-17.2-7.511.823.7-  
Imports (annual variation in %)-2.48.09.26.5-  
International Reserves (EUR)2.92.93.03.4-  

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Albania Facts

Value Change Date
Exchange Rate108.6-0.56 %Jan 01
Stock Market0.10.0 %Jan 07

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