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INTRODUCTION The name "Albania" is derived from an ancient Illyrian tribe, the Albanoi, who inhabited part of modern-day Albania from around 1225 BC to AD 200. Albanians call their country Shqipri (Skip-AIR-ee), "Land of the Eagle." For almost 500 years, Albania was controlled by the Turks of the Ottoman Empire. The Albanians fought to resist being controlled by the Turks. Their national hero, Skanderbeg, led the Albanian people's resistance to the Ottoman Empire in the 1400s in at least twenty-five fierce battles. It was only after Skanderbeg died in 1468 that the Turks were able to claim victory. They then ruled for 445 years. The Turks were Muslims, and a majority of Albanians became Muslims during this period. Albania won independence from the Ottoman Empire in 1912. Its present-day boundaries were confirmed following World War I (191418) at the Paris Peace Conference in 1919. Albania has twelve counties which are distributed among districts. The counties are appointed by council of ministers. Every district has its own administration and governor who is elected by District Council. Municipalities are the administrative bodies under the districts and the countries. 2 GEOGRAPHY LOCATION Albania is one of the Balkan countries that form a peninsula bordered by the Adriatic, Aegean, and Black Seas. The word "Balkan" means mountain in Turkish, and the Balkan countries take their name from the Balkan Mountains. Albania is about the same size as the state of Maryland. Albania's dimensions are 230 miles (370 kilometers) long by about 90 miles (144 kilometers) at its widest point. Albania's western edge borders the Adriatic Sea, about 50 miles (80 kilometers) from the "boot" of Italy. The coastline features some areas of scenic white sandy beaches. Along the coast the summers are hot and dry, while the winters are rainy.

3 DEMOGRAPHY There are an estimated six million Albanians in Europe. The 1991 census for the Republic of Albania gives a total population of 3,255,891. In addition there are about two million Albanians in Kosovo, about five-hundred thousand in the Republic of Macedonia, and about one-hundred thousand in Montenegro. It is estimated that about one-hundred thousand people from the traditional Italo-Albanian communities in southern Italy can still speak Albanian. Figures for Albanian settlements in Greece are unavailable because the Greek government does not acknowledge the existence of an Albanian minority there. All these figures are estimates and fluctuate because of the extremely high birthrates of Albanians and the high level of emigration from Albania and Kosovo. An estimated three-hundred thousand emigrants from Albania now live in Greece, and about two-hundred thousand reside in Italy. In addition, there are about twohundred thousand Albanians, mostly from Kosovo, living in central Europe (mainly Switzerland and Germany). In the last ten years, Albanians have emigrated to most other countries in Europe, as well as the United States, Canada, and Australia.
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4 LINGUISTIC AFFILIATION The Albanian language, shqip , is Indo-European, although it is not a member of any of the major branches of the Indo-European family. Despite its Indo-European affiliation and presence in the Balkans since ancient times, it is difficult to pinpoint the exact ancestry of the Albanian language because of the radical transformations that have taken place within it through the centuries. Among these transformations has been a substantial reduction in word length and extreme morphological alterations. Whether the Albanian language stems from Illyrian or Thracian, both, or neither is a matter of contention. The theory of the Illyrian origin of the Albanian people is the one most widely accepted in Albania and has been raised to the level of a national and state ideology. There is little evidence to prove or disprove this theory, since little is known about the Illyrian language. Since ancient times, very substantial strata of Latin and of Slavic and Turkish have been added to Albanian, making the older strata more difficult to analyze. Albanian is a synthetic language that is similar in structure to most other Indo-European languages. Nouns are marked for gender, number, and case as well as for definite and indefinite forms. The vast majority of nouns are masculine or feminine, though there are a few neuter nouns. The nominal system distinguishes five cases: nominative, genitive, dative, accusative, and ablative; the genitive and dative endings are always the same. Attributive genitives are linked to the nouns they qualify by a system of connective particles. Albanian verbs have three persons, two numbers, ten tenses, two voices, and six moods. Unusual among the moods is the admirative, which is used to express astonishment. Among other particular features of Albanian and other Balkan languages are a postpositive definite article and the absence of a verbal infinitive. Although Albanian is not directly related to Greek, Serbo-Croatian, Romanian, or Bulgarian, it has much in common with all those Balkan languages after centuries of close contact.

Prayer room at the Mosque of Etem Bay, in the capital city at Tirana. Ironically, because the Belgrade authorities willfully destroyed the Albanian-language educational system in Kosovo in the mid-1980s, an increasing number of young people there, educated in "underground" schools, no longer speak and understand Serbo-Croatian. 5 FOREIGN RELATIONS OF ALBANIA Albanian foreign policy since its independence has maintained a policy of complementarism by trying to have friendly relations with all countries. Albania is a member of more than 48 different international organizations including the United Nations, the Council of Europe, the North Atlantic Treaty Organization, The Organisation of Islamic Cooperation., the Organization for Security and Cooperation in Europe, the International Monetary Fund, the World Trade Organization andLa Francophonie. The main factors defining Albanian foreign policy consist of geopolitical location, population, economic crisis, and ties with Albanian diaspora throughout the world. Albania has concentrated on maintaining good relations with its Balkan neighbours, gaining access to European-Atlantic security institutions, and securing close ties with the United States. On 14 January 2011, Albania signed a pact with Italy for a corporal foreign strategy.

6 MILITARY OF ALBANIA Military branches: Land Forces Command, Air Forces Command, Training and Doctrine Command (2010) Military service age and obligation: 19 years of age (2004) Manpower available for military service: males age 16-49: 731,111 females age 16-49: 780,216 (2010 est.) males age 16-49: 622,379 females age 16-49: 660,715 (2010 est.) male: 31,986 female: 29,533 (2010 est.) 1.49% of GDP (2005 est.) country comparison to the world: 99

Manpower fit for military service:

Manpower reaching militarily significant age annually:

Military expenditures:

7 CURRENCY OF ALBANIA The currency used in Albania is called as the Lek. This currency is denoted with the currency sign Lek and the ISO 4217 Code for the Albanian Lek is ALL. The Lek, is the official currency of the Albania . It is divided into 100 smaller units called qindark. The constitution of Albania provides that the Albania government shall have the power to print the Albanian Lek and qindark coins to be used as a legal tender in Albania. The Albanian Lek bank notes and Qindark coins are both designated as "legal tender" in payment of debts. The Albanian Lek bill uses the decimal system, consisting of 100 equal units. The symbol Lek, usually written before the numerical amount, is used for the Albanian Lek. Currently printed bank notes denominations are 200, 500, 1000 and 2000 lek 5000 lek and the coins are minted in the denominations of 5, 10, 20, 50, 100 lek 1 lek.

8 ECONOMY OF ALBANIA The economy of Albania has undergone a transition from its communist past into an open-market economy in the early 1990s. Although the country is rich in natural resources, the economy is mainly bolstered by agriculture, food processing, lumber, oil, cement, chemicals, mining, basic metals, hydropower, tourism, textile industry, migrant remittances, and the informal economy. The collapse of communism in Albania came later and was more chaotic than in other Eastern European countries and was marked by a mass exodus of refugees to Italy and Greece in 1991 and 1992. The country attempted to transition to autarky, but this eventually failed. Attempts at reform began in earnest in early 1992 after real GDP fell by more than 50% from its peak in 1989. Albania currently suffers from high organised crime and corruption rates. The democratically elected government that assumed office in April 1992 launched an ambitious economic reform program to halt economic deterioration and put the country on the path toward a market economy. Key elements included price and exchange system liberalization, fiscal consolidation, monetary restraint, and a firm income policy. These were complemented by a comprehensive package of structural reforms including privatization, enterprise, and financial sector reform, and creation of the legal framework for a market economy and private sector activity. Most agriculture, state housing, and small industry were privatized. This trend continued with the privatization of transport, services, and small and medium-sized enterprises. In 1995, the government began privatizing large state enterprises. After reaching a low point in the early 1990s, the economy slowly expanded again, reaching its 1989 level by the end of the decade. Albania remains a poor country by Western European standards. According to Eurostat, Albania's GDP per capita (expressed in PPS Purchasing Power Standards) stood at 25 percent of the EU average in 2008. Results of Albania's efforts were initially encouraging. Led by the agricultural sector, real GDP grew by an estimated 11% in 1993, 8% in 1994, and more than 8% in 1995, with most of this growth in the private sector. Annual inflation dropped from 25% in 1991 to single-digit numbers. The Albanian currency, the lek, stabilized. Albania became less dependent on food aid. The speed and vigor of private entrepreneurial response to Albania's opening and liberalizing was better than expected. Beginning in 1995, however, progress stalled, with negligible GDP growth
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in 1996 and a 9% contraction in 1997. A weakening of government resolve to maintain stabilization policies in the election year of 1996 contributed to renewal of inflationary pressures, spurred by the budget deficit which exceeded 12%. Inflation approached 20% in 1996 and 50% in 1997. The collapse of financial pyramid schemes in early 1997 which had attracted deposits from a substantial portion of Albania's population triggered severe social unrest which led to more than 1,500 deaths, widespread destruction of property, and an 8% drop in GDP. The lek initially lost up to half of its value during the 1997 crisis, before rebounding to its January 1998 level of 143 to the dollar. The new government, installed in July 1997, has taken strong measures to restore public order and to revive economic activity and trade. Albania is currently undergoing an intensive macroeconomic restructuring regime with the International Monetary Fund and the World Bank. The need for reform is profound, encompassing all sectors of the economy. In 2000, the oldest commercial bank, Banka Kombetare Tregtare/BKT was privatized. In 2004, the largest commercial bank in Albaniathen the Savings Bank of Albaniawas privatised and sold to Raiffeisen Bank of Austria for US$ 124 million. Lagging behind its Balkan neighbors, Albania is making the difficult transition to a more modern open-market economy. Macroeconomic growth has averaged around 5% over the last five years and inflation is low and stable. The government has taken measures to curb violent crime, and recently adopted a fiscal reform package aimed at reducing the large gray economy and attracting foreign investment. The economy is bolstered by annual remittances from abroad representing about 15% of GDP, mostly from Albanians residing in Greece and Italy; this helps offset the towering trade deficit. The agricultural sector, which accounts for over half of employment but only about one-fifth of GDP, is limited primarily to small family operations and subsistence farming because of lack of modern equipment, unclear property rights, and the prevalence of small, inefficient plots of land. Energy shortages because of a reliance on hydropower, and antiquated and inadequate infrastructure contribute to Albania's poor business environment and lack of success in attracting new foreign investment. The completion of a new thermal power plant near Vlore has helped diversify generation capacity, and plans to improve transmission lines between Albania and Montenegro and Kosovo would help relieve the energy shortages. Also, with help from EU funds, the government is taking steps to improve the poor national road and rail network, a long-standing barrier to sustained economic growth.
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Reforms have been taken especially since 2005. In 2009, Albania was the only country in Europe, together with San Marino and Liechtenstein, to have economic growth; Albanian GDP real growth was 3.7%. Year after year, the tourism sector has gained a growing share in the country's GDP. Data published as of July 2012 by the National Institute of Statistics, INSTAT, show the economy contracted by 0.2 per cent in the first quarter of the year - a downturn blamed mainly on the euro zone debt crisis. GDP (purchasing power parity): $25.23 billion (2011 est.); country comparison to the world: 117 $24.74 billion (2010 est.) Albania has an informal, and unreported, sector that may be as large as 50% of official GDP

GDP (official exchange rate): $12.85 billion (2011 est.)

GDP - real growth rate: 2% (2011 est.); country comparison to the world: 150 3.5% (2010 est.)

GDP - per capita (PPP): $7,800 (2011 est.); country comparison to the world: 129

GDP - composition by sector: agriculture: 20.7% industry: 19.7%; services: 59.6% (2011 est.)

Labor force: 1.053 million (2010 est.); country comparison to the world: 142

Labor force - by occupation: agriculture: 47.8%; industry: 23%; services: 29.2% (September 2010 est.)

Unemployment rate: 13.3% (2011 est.); country comparison to the world: 139; 13.7% (2010 est.) note: these are official rates, but actual rates may exceed 30% due to preponderance of near-subsistence farming

Population below poverty line: 12.5% (2008 est.)

Household income or consumption by percentage share: lowest 10%: 3.5%; highest 10%: 29% (2008)

Distribution of family income - Gini index: 34.5 (2008); country comparison to the world: 88 26.7 (2005)

Investment (gross fixed): 29.9% of GDP (2011 est.); country comparison to the world: 20

Budget:
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revenues: $3.289 billion; expenditures: $3.738 billion (2011 est.)

Taxes and other revenues: 25.6% of GDP (2011 est.); country comparison to the world: 122

Budget surplus (+) or deficit (-): -3.5% of GDP (2011 est.); country comparison to the world: 114

Public debt: 59.7% of GDP (2011 est.); country comparison to the world: 42; 57.1% of GDP (2010 est.)

Inflation rate (consumer prices): 3.5% (2011 est.); country comparison to the world: 84

Central bank discount rate: 5% (31 December 2010 est.); country comparison to the world: 66 5.25% (31 December 2009 est.)

Stock of narrow money: $3.024 billion (31 December 2011 est.); country comparison to the world: 117 $2.648 billion (31 December 2010 est.)

Stock of broad money:


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$9.951 billion (31 December 2011 est.); country comparison to the world: 107 $5.813 billion (31 December 2010 est.)

Stock of domestic credit: $9.208 billion (31 December 2011 est.); country comparison to the world: 99 $7.953 billion (31 December 2010 est.)

Agriculture - products: wheat, corn, potatoes, vegetables, fruits, sugar beets, grapes; meat, dairy products

Industries: food processing, textiles and clothing; lumber, oil, cement, chemicals, mining, basic metals, hydropower

Industrial production growth rate: 3% (2010 est.); country comparison to the world: 105

Current account balance: -$1.595 billion (2011 est.); country comparison to the world: 135 -$1.404 billion (2010 est.)

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Exports: $1.954 billion (2011 est.); country comparison to the world: 143 $1.548 billion (2010 est.)

Exports - commodities: textiles and footwear; asphalt, metals and metallic ores, crude oil; vegetables, fruits, tobacco

Exports - partners: Italy 48.8%, China 8.4%, Turkey 6.7%, Greece 5.6%, Spain 5.4%, India 4.9% (2010 est.)

Imports: $5.076 billion (2011 est.); country comparison to the world: 129

Imports - commodities: machinery and equipment, foodstuffs, textiles, chemicals

Imports - partners: Italy 34.8%, Greece 12.9%, China 6.2%, Turkey 6%, Germany 4.6% (2010 est.)

9 SOCIAL INSTITUTIONS A GENERAL ROLES AND STATUSES The relative status of women and men: Albania is a patriarchal society based on male predominance. Women are accorded subordinate roles. The communist Party of Labor did much
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to emancipate women during a revolutionary campaign in the late 1960s and early 1970s, but many of the gains of that social revolution have been reversed since the introduction of democracy and a free market economy. Old traditions have revived, and despite legal equality and acceptance in the workforce, women have much less representation in public life than they did under the former regime. B MARRIAGE, FAMILY, AND KINSHIP Marriage: Marriages in Albania are socially and legally restricted to heterosexual couples. They often are arranged at an early age in the countryside, traditionally by the parents of the groom with the help of a matchmaker rather than by the couple. Remaining unmarried is looked on as a great misfortune. In some mountain regions, the bride was stolen from her family, that is, spirited away by an armed bridegroom or by his male relatives and companions. This usually symbolic though occasionally real theft of a bride was also a common custom among the Italo-Albanians of Calabria. In other regions, it was customary to purchase a wife. In zones such as Mirdit and the northern mountains, the father, brother, or another male relative of the bride still presents the groom with a bullet wrapped in straw. The new husband is thus free to kill his wife with the approval of her family if she proves to be disobedient. Albanian weddings are impressive festivities. They are virtually the only popular celebrations observed today and thus are taken very seriously. Whole villages and, in towns, hundreds of people may be invited to take part in a wedding banquet. The celebrations can last several days. Traditionally, weddings take place during the full moon to ensure offspring. Monogamy was always the rule in Albania, but polygamous marriages existed up to the beginning of the twentieth century in some areas, particularly if the first wife was not able to bear a son. Live-in concubines were not uncommon in the mountains up to World War II. Albanian women were as a rule faithful to their husbands. Since a wife was considered the property of her husband, adultery amounted to theft. Thus, cases of adultery were punished severely under traditional law. Premarital and extramarital sex was more prevalent in the northern highlands, the part of the country with the most rigid moral code. Divorce is now a common phenomenon.

C) EDUCATIONAL SYSTEM
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Albania, as an official EU candidate country, has much progress to make toward the EUs education benchmarks before its accession. While education improvement in Albania is supported by its government and growing economy, the country still faces many obstacles to matching the educational outputs of its neighbors in Western Europe. Albania has a per capita GNP of $5,316 USD (PPP), which is the lowest in South-eastern Europe and among the lowest in the region of Central and Eastern Europe and the Commonwealth of Independent States (CEE/CIS). Its annual growth rate has hovered around 5.2% since 1990. While Albanias economy continues to grow, its total government expenditure is the lowest in Southeastern Europe with only 3% of its budget allocated to education and 3.7% to health. The average standard of living in Albania is among the lowest in the sub-region, with 25.4% of the population living below the national poverty line and 50% of the population living on less than $4.00 USD a day. The national unemployment rate - 15% - is in comparable range to the poorest countries in the region. Yet its child labor rates are the highest in the region with almost 30% of boys and 20% of girls working before the legal age. Albania has taken significant strides to close the gaps in equity in its education system and it has made many accomplishments in primary education. It has achieved gender parity in primary education, with a Gender Parity Index (GPI) of 1.0. Girls participation in education remains high throughout upper secondary education, with a GPI of .98 and far surpasses that of boys in tertiary education; 50% more girls enroll in higher education than boys (GPI=1.5).The bigger gaps in educational opportunity are based on geographic location and economic status. Throughout primary education, children living in rural areas have higher rates of participation than those children living in urban areas. Rural children have higher attendance rates, higher enrolment rates, and higher survival and completion rates. However, by secondary school the situation changes dramatically. Half as many rural children (13.6%) attend secondary education as urban children (27.2%), and rural childrens attendance rates (13.6%) are half that of urban childrens (27.2%) in secondary school.

Primary Education
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The Albanian literacy rate hovers at around 99% and efforts are ongoing to maintain this. Although education is only compulsory for the first 9 grades, most young people stay on through to grade 12. The academic year, divided into two semesters begins in september / october and ends in june / july. Primary education lasts for 9 years following a non-mandatory period spent at preschool. Secondary Education Secondary education known as regular takes a further three years to complete. The focus is on academic teaching and preparation for university. Many schools have recently been rebuilt and are being equipped with modern technologies. Vocational Education Vocational education, which is an alternative to regular school takes between 2 to 5 years depending on whether a simple diploma or a full trade qualification is desired. Considerable effort by the state in this direction is adding muscle to a growing economy. Tertiary Education There are a significant number or universities in Albania both public and private, and these are well dispersed in the major cities. The University of Tirana was the first when founded in 1957, and today has a student population approaching 15,000 and a teaching staff of nearly 900. Its faculties include economic sciences, foreign languages, history & philology, medicine, natural sciences, law, social sciences, and physical education, and its international reputation is growing. D) POLITICAL SYSTEM ALBANIA WAS THE LAST COUNTRY in Eastern Europe during the early 1990s to undergo a transition from a totalitarian communist regime to an incipient system of democracy. Because Albania was isolated from the outside world and ruled by a highly repressive, Stalinist-type dictatorship for more than four decades, this transition was especially tumultuous and painful, making a gradual approach to reform difficult. Following the establishment of the People's Republic of Albania in January 1946, Albania became a rigid police state, dominated completely by the communist party and by Marxism/Leninism. Although Albania operated under the facade of constitutional rule, the communist party, led by Enver Hoxha, who was also president of
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Albania, actually controlled all aspects of the political, social, and economic systems. Hoxha pursued a repressive internal policy, while at the same time implementing a highly isolationist foreign policy. His reliance first on the financial aid and political protection of a sequence of patron states, then insistence on Albania's economic self-reliance, and a highly centralized economic system caused Albania to lag far behind its neighbors in terms of economic development. Between 1990 and 1992 Albania ended 46 years of xenophobic Communist rule and established a multiparty democracy. The transition has proven challenging as successive governments have tried to deal with high unemployment, widespread corruption, a dilapidated physical infrastructure, powerful organized crime networks, and combative political opponents. Albania has made progress in its democratic development since first holding multiparty elections in 1991, but deficiencies remain. International observers judged elections to be largely free and fair since the restoration of political stability following the collapse of pyramid schemes in 1997. In the 2005 general elections, the Democratic Party and its allies won a decisive victory on pledges of reducing crime and corruption, promoting economic growth, and decreasing the size of government. The election, and particularly the orderly transition of power, was considered an important step forward. Although Albania's economy continues to grow, the country is still one of the poorest in Europe, hampered by a large informal economy and an inadequate energy and transportation infrastructure. Albania has played a largely helpful role in managing inter-ethnic tensions in southeastern Europe, and is continuing to work toward joining NATO and the EU. Albania, with troops in Iraq and Afghanistan, has been a strong supporter of the global war on terrorism. Politics of Albania takes place in a framework of a parliamentary representative democratic republic, wherein the Prime Minister is the head of government, and of a multi-party system. Executive power is exercised by the government. Legislative power is vested in both the government and parliament, the Assembly of the Republic of Albania (Kuvendi i Republiks s Shqipris). Since 1991, the introduction of pluralism, the party system is dominated by the Democratic Party of Albania and the (post-communist) Socialist Party of Albania. Its official journal is Albanian Official Journal. EXECUTIVE BRANCH
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The head of state in Albania is the President of the Republic. The President is elected to a 5-year term by the Assembly of the Republic of Albania by secret ballot, requiring a two-thirds majority of the votes of all deputies. Bujar Nishani was on 11 June 2012 elected president by a simple majority of deputies in the assembly, after it had failed on three earlier occasions to agree on a nominee. He took the oath of office on 25 July 2012. The President has the power to guarantee observation of the constitution and all laws, act as commander in chief of the armed forces, exercise the duties of the Assembly of the Republic of Albania when the Assembly is not in session, and appoint the Chairman of the Council of Ministers (Prime Minister). Executive power rests with the Council of Ministers (cabinet). The Chairman of the Council (Prime Minister) is appointed by the President; ministers are nominated by the President on the basis of the Prime Minister's recommendation. The People's Assembly must give final approval of the composition of the Council. The Council is responsible for carrying out both foreign and domestic policies. It directs and controls the activities of the ministries and other state organs. Legislative branch The Assembly of the Republic of Albania (Kuvendi i Republiks s Shqipris) is the lawmaking body in Albania. There are 140 deputies in the Assembly, of which 100 are directly elected by an absolute majority of the voters, and 40 are chosen by their parties on the basis of proportional representation. The President of the Assembly (or Speaker) has two deputies and chairs the Assembly. There are 15 permanent commissions, or committees. Parliamentary elections are held at least every 4 years. The Assembly has the power to decide the direction of domestic and foreign policy; approve or amend the constitution; declare war on another state; ratify or annul international treaties; elect the President of the Republic, the Supreme Court, and the Attorney General and his or her deputies; and control the activity of state radio and television, state news agency, and other official information media. Judicial Branch The court system consists of a Constitutional Court, the Court of Cassation, appeals courts, and district courts. The Constitutional Court comprises nine members appointed by the People's Assembly for maximum 9-year terms. The Constitutional Court interprets the constitution,
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determines the constitutionality of laws, and resolves disagreements between local and federal authorities. The remaining courts are each divided into three jurisdictions: criminal, civil, and military. The Court of Cassation is the highest court of appeal and consists of 11 members appointed by the People's Assembly and serving 7-year terms. The President of the Republic chairs the High Council of Justice (HCJ) charged with appointing and dismissing other judges. The HCJ was expanded in late 1997 to comprise 13 members from among the various branches of government. A college of three judges renders Albanian court verdicts; there is no jury trial, although the college is sometimes referred to in the Albanian press as the "jury." Tax Rate The Legal and physic persons in the Republic of Albania are subject to the following taxes:
Type of Tax Tax Rate Profit Tax Personal Income Tax Withholding Tax Value Added Tax Tax rate 10% 10% 10% 20%

Profit Tax: All companies (foreign or not) which are registered in the trade register and pay VAT are subject to the profit tax. The Resident taxpayers are subject to taxation only for incomes generated (produced) in the territory of the Republic of Albania. A legal person is considered resident in Albania if: a)he has a permanent residence (central offices) in the Republic of Albania b) he has an efficient center of business management in the Republic of Albania The tax rate for profit tax is 10%. LEGAL SYSTEM Albania is a Parliamentary Republic. Sovereignty in the Republic of Albania belongs to the people. The Constitution is the highest law in the Republic of Albania, and was adopted by popular referendum on November 28, 1998. The system of government is based on the
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separation and balancing of the legislative, executive and judicial powers. The unicameral Parliament (Kuvendi) represents the legislative branch. The executive branch is represented by the President as the Chief of State, Prime Minister as the Head of Government, and the Council of Ministers. The judicial branch is composed of the Constitutional Court, the Supreme Court and multiple Appeal Courts and District Courts. The unicameral Parliament (Kuvendi) consists of 140 seats, 100 of which are determined by direct popular vote. The remaining 40 seats are distributed by proportional representation. All Parliament members serve a four-year term. The internal structure of Parliament is composed of the Speaker, Deputy Speakers, Bureau of Parliament, Parliamentary Groups, and Parliamentary Commissions. The President is the head of state and is elected by a three-fifths majority vote of all Parliament members. The President serves a term of five years with the right to one re-election. Although the position is largely ceremonial, the Constitution does give the President authority to appoint and dismiss from office some civil servants in the executive and judicial branches and to issue decrees. The Prime Minister is appointed by the President and approved by Parliament. The Prime Minister serves as the Chairman of the Council of Ministers, which consists of the Prime Minister, Deputy Prime Minister, and 18 ministers. Members of the Council of Ministers are nominated by the Prime Minister and approved by the President. The Council of Ministers introduces to Parliament draft laws necessary for implementing the Constitution, and issues decisions, instructions, regulations and orders to implement the body of laws approved by Parliament. THE JUDICIARY SYSTEM The Constitutional Court: The Constitutional Court was created on the basis of the Constitution and law no. 8577, date 10.2.2000 "On organization and operation of the Constitutional Court" establishes the organization and operation of the Constitutional Court. The Constitutional Court is composed of nine members, appointed by the President of the Republic with the consent of Parliament. They are appointed for nine-year terms and do not have the right to be re-appointed. The Constitutional Court reviews the compatibility of laws and normative acts of central and local bodies with the Constitution or international agreements, which, after ratified by
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Parliament, prevail over Albanian law. All Constitutional Court decisions are published in the Official Gazette, along with dissents. The High Council of Justice (in Albanian and English). The High Council of Justice is composed of 15 members- the President of the Republic, who chairs the High Council of Justice, the Chief Justice of the Supreme Court, the Minister of Justice, three members elected by the Assembly, and nine judges from any level in the court system who is elected by the National Judicial Conference The Supreme Court (in Albanian and English) The Supreme Court is organized and operates in compliance with law no. 8588, date 15.3.2000 "On the organization and operation of the Supreme Court of the Republic of Albania." The Supreme Court is the highest court of appeal and is composed of 17 judges appointed for a nineyear term by the President with the consent of Parliament. The Supreme Court is organized in civil and criminal panels. The criminal panel tries military and criminal cases and the civil panel tries commercial, administrative, family, labor cases and the like. Courts of Appeal Courts of Appeal sit in six different regions of the country and review complaints against decisions of Courts of First Instance. These courts sit in three judge panels. The Courts of Appeal function in regions defined by the President of the Republic, based on a proposal of the Minister of Justice after consulting the High Council of Justice. The assignment of cases to judicial panels at all levels of the judicial system is done by lottery according to procedures provided by law. To be appointed a judge in the Courts of Appeal, one must possess full legal competence, hold a law degree, have no criminal record, have a "good reputation," and be at least twenty-five years old. Judges of the Courts of Appeal are nominated by the High Council of Justice and appointed by the President of the Republic. Courts of First Instance

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The Courts of First Instance try according to rules provided in the Codes of Civil Procedure and Criminal Procedure, where the composition of the judges' panel is also defined. Courts of First Instance are organized and function in thirty-six judicial districts throughout the country. Military Courts Military Courts are organized and function within the judicial system according to powers defined in law. Military Courts are composed of Courts of First Instance and a Court of Appeal. Military Courts try military cases. The military Court of Appeal reviews in the second level complaints filed against decisions of the Military Courts of First Instance. The Military Courts try cases using panels of three judges. Bar Association The Bar was established on the basis of a 1990 reform (Law no. 7382, date 8.5.1990 For the Advocacy in the People's Socialist Republic of Albania, and amendment of article 9, 10 and 14 of the Code of Penal Procedure, by law no. 7387, date 8.5.1990. The Bar consists of collegiums of advocates. Membership is restricted to persons with a law degree and who have at least three years experience as lawyers. The Minister of Justice may grant exceptions from these requirements. Advocates do not have a monopoly on the presentation of cases in court. Individual citizens remain free to present their own case in court. E) SOCIAL ORGANIZATIONS SYMBOLISM The national and ethnic symbol of the Albanians is the eagle, which was used in that capacity in the earliest records. The eagle appears in a stone carving dating from 1190, the time of the socalled first Albanian principality, known as Arbanon, and was used as a heraldic symbol by a number of ruling families in Albania in the late Middle Ages, including the Castriotta (Kastrioti), the Muzakaj (Myzeqe), and the Dukagjini. A black double-headed eagle also was placed by the national hero Scanderbeg on his flag and seal. This form of the eagle, deriving from the banner of the Byzantine Empire, has been preserved as an ethnic symbol by the Arberesh of southern Italy. In the late nineteenth century, the double-headed eagle was taken up by the nationalist movement as a symbol of resistance to the Ottoman Empire and was used on the banners of freedom fighters seeking autonomy and independence. The current flag, bearing this black
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double-headed eagle on a red background, was officially raised on 28 November, 1912 to mark the declaration of Albanian independence in Vlor and has been used since that time by the Republic of Albania and by Albanians everywhere as the national symbol. In Albanian oral literature and folklore, the eagle appears as a symbol of freedom and heroism, and Albanians often refer to themselves as the "Sons of the Eagle." The popularity of the eagle among Albanians derives from the similarity between the words shqipe (eagle) and the terms for the Albanian language, an Albanian person, and Albania. Another beloved symbol is the Albanian prince and national hero Scanderbeg (14051468). His real name was George Castriotta (Gjergj Kastrioti). Sent by his father as a hostage to the Turkish Sultan Murad II (ruled 14211451), he was converted to Islam and, after being educated in Edirne, was given the name Iskander (Alexander) and the rank of bey. In 1443, after the Turkish defeat at Nish by John Corvinus Hunyadi (13851456), Scanderbeg abandoned the Ottoman army, returned to Albania, and embraced Christianity. He took over the central Albanian fortress of Kruja and was proclaimed commander in chief of an independent Albanian army. In the following years, Scanderbeg successfully repulsed thirteen Ottoman invasions and was widely admired in the Christian world for his resistance to the Turks, being accorded the title Athleta Christi by Pope Calixtus III (ruled 14551458). Scanderbeg died on 17 January 1468 at Lezha (Alessio), and Albanian resistance collapsed a decade afterward. In 1478, his fortress at Kruja was taken by the Turks, and Albania experienced four centuries of Ottoman rule. For Albanians, Scanderbeg is the symbol of resistance to foreign domination and a source of inspiration in both oral and written literature. It is common in the homes of Albanian families living abroad to find not only an Albanian flag but also a bust or portrait of Scanderbeg. HISTORY AND ETHNIC RELATIONS Emergence of nation: Albanians are a native Balkan people, although their exact origin is unclear. The national ideology insists on an unequivocal ethnic relationship with the ancient Illyrians. As little is known about the Illyrians and there are no historical records referring to the existence of the Albanian people during the first millennium C . E ., it is difficult to affirm or deny the relationship. Albanians entered postclassical recorded history in the second half of the eleventh century, and only in this age can one speak with any degree of certainty about the Albanian people as they are known today. In his History written in 10791080, the Byzantine
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historian Michael Attaleiates was the first to refer to the Albanoi as having taken part in a revolt against Constantinople in 1043 and to the Arbanitai as subjects of the duke of Dyrrachium. Similarly, the historian John Scylitzes refers (ca. 1081) to the Arbanites as forming part of the troops assembled in Durrs by Nicephorus Basilacius. It can be assumed that the Albanians began expanding from their mountain homeland in the eleventh and twelfth centuries, initially taking possession of the northern and central coastline and by the thirteenth century spreading southward toward what are now southern Albania and western Macedonia. In the middle of the fourteenth century, they migrated farther south into Greece, initially into Epirus, Thessaly (1320), Acarnania, and Aetolia. By the middle of the fifteenth century, which marks the end of this process of colonization, the Albanians had settled in over half of Greece in such great numbers that in many regions they constituted the majority of the population. Despite these extensive settlements, the Albanians, largely a herding and nomadic people, do not seem to have created any substantial urban centers. There were no noticeable Albanian communities in the cities of the Albanian coast during the Middle Ages. Durrs was inhabited by the Venetians, Greeks, Jews, and Slavs; Shkodra, by the Venetians and Slavs; and Vlor, by the Byzantine Greeks. It is estimated that a considerable proportion of Albanians were assimilated by the time of the Turkish invasion; in other words, the Albanians had been largely marginalized in their own country. Only during the Ottoman period did they began to settle in towns and acquire some of the characteristics of a nation rather than those of nomadic tribes. Ethnic relations: The Balkan peninsula is inhabited by a multitude of ethnic groups, and relations among them have never been good. Exacerbated nationalism and age-old rivalry for territory and supremacy have always created ethnic tension. This is especially true in regions with mixed settlement patterns, where ethnic groups are not separated by clear-cut political borders. While ethnic relations between Albanians and Greeks along their common border have improved substantially over the last decade, that cannot be said of relations between Albanians and their Slavic neighbors in the former Yugoslavia. In Kosovo, the Albanian majority was reduced to the status of an oppressed colonial people after the Serb conquest of the region at the beginning of the twentieth century. The open conflict that broke out in 1997 was, however, not initially one between Kosovo Albanians and Kosovo Serbs but between Kosovo Albanians and a hostile Serb regime in Belgrade. Relations between Albanians and Macedonians in the western part of the Republic of Macedonia have been tense since the declaration of Macedonian
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independence and the downgrading of the status of Albanians there to that of a "national minority." Land tenure and property: Albania is a mountainous country with an extremely high birthrate, and there is not enough farmland. Agriculture was reprivatized in the early 1990s after the fall of the communist regime, and many properties were returned to their former owners. Most families, however, received extremely small plots barely large enough to survive on. Property disputes are common and have been a major cause of blood feuding. Although most political parties have strategies for the further privatization of industry and nonagricultural land, many problems remain. Commercial activities, major industries and trade: aside from agricultural output, Albania is a major producer of chrome. There are also significant deposits of copper and nickel and some oil. The country is still reeling from the radical transformation from a socialist to a free market economy, and commercial activity has not attained its potential. Virtually all the major industries went bankrupt and collapsed in the early 1990s when a free market economy was introduced. Some mines, chrome in particular, are still in production, but most have stagnated under pressure from foreign competition. Among the few sectors of the economy that are doing well is the construction industry. Domestic building materials are now widely available on the local market and increasingly on foreign markets. The European Union is the major trading partner, with Italy, Greece, and Germany leading in imports and exports. The national trade deficit has been compensated to some extent by foreign exchange remittances from Albanian emigrants working abroad. SOCIAL STRATIFICATION Classes and castes: Under the communist regime, which called for absolute equality and the rule of a single working class, there were in fact three social castes. The ruling caste was composed of the extended families of politburo members and related communist families and clans. The majority of the population was in the working class. The

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Workmen at a metallurgical plant in Elbasan, Albania. Much of the Albanian industrial sector collapsed with the introduction of a free market economy in the early 1990s. lowest caste consisted of once prosperous farming families, the precommunist middle class, and opponents of the regime. Many of those families were sent to the countryside into internment or internal exile and were denied access to many professions and to education for their children. This caste system broke down with the fall of the communist regime and has been replaced by a system where status is determined exclusively by wealth. URBANISM, ARTITIECTURE AND USE OF SPACE The traditional architecture of Albania almost disappeared during the Stalinist dictatorship of 1944 1990. The old towns and bazaars of Tirana and many other urban centers were demolished and replaced by socialist prestige objects or uniform housing blocks. In the late 1960s and early 1970s, virtually all the churches and mosques were razed or transformed beyond recognition. The Catholic cathedral of Shkodra, for instance, was transformed into a sports hall with a volleyball court, and that of Tirana into a movie theater. With the exception of Berat and Gjirokastr, which were declared museum cities, little of the traditional flavor of Albanian towns can now be found. Most of the older public buildings that survived the communist period in Tirana, such as the main government ministries

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Agricultural workers travel between Tirana and Kavaj. While Albania has a large rural population, most families in the countryside can barely raise enough crops to feed themselves. and the university, date from the Italian period (1930s1940s). The main thoroughfare of Tirana from Scanderbeg Square to the university was constructed by the Italians as a symbol of Italian fascism. The lack of zoning regulations led in the 1990s to chaos in construction and the use of space, destroying the little that survived the communist regime. Old villas have been demolished, and most parks and public gardens disappeared under a myriad of kiosks and cafs. 10 RELIGION Religious belief: Albania is on the border dividing three religions: Roman Catholicism, Greek Orthodoxy, and Islam. According to the last reliable statistics on religion (1942), among a population of 1,128,143, there were 779,417 (69 percent) Muslims, including the Bektashi; 232,320 (21 percent) Orthodox; and 116,259 (10 percent) Catholics. One can estimate today that approximately 70 percent of Albanians in the republic are of Muslim, including Bektashi, background; about 20 percent, mostly in the south, are Orthodox; and about 10 percent, mostly in the north, are Catholic. In 1967, all religious communities were dissolved when a communist government edict banned the public practice of religion. The law was rescinded only in December 1990 during the collapse of the regime. Despite the return of religious freedom, there seems to be more interest in the revival of Christianity and Islam among foreign missionaries and groups than there is among Albanians. Albanians have never had a national religion with which to identify as a people. For the last century and a half, national (ethnic) identity has predominated
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over religious identity, and this is unlikely to change in the coming years in a small and struggling nation surrounded by hostile neighbors. Organized religion still plays only a marginal role in public life. Religious fervor is extremely rare, and religious extremism is virtually unknown. THE ARTS AND HUMANITIES Literature: The foundations of a national literature were laid in the second half of the nineteenth century with the rise of a nationalist movement striving for Albania's independence from a decaying Ottoman Empire. The literature of this so-called Rilindja period of national awakening was characterized by romantic nationalism and provides a key to an understanding of the Albanian mentality today. At the beginning of the twentieth century, the Catholic education facilities set up by the Franciscans and Jesuits in Shkodra under the auspices of the AustroHungarian Kultusprotektorat paved the way for the creation of an intellectual lite that produced the rudiments of a more sophisticated literature which expressed itself primarily in poetry. The culmination of Albanian literature before World War II appears in the works of the Franciscan priest Gjergj Fishta (18711940), once lauded as the national poet. From 1945 to 1990, for primarily political reasons, Fishta was ostracized from the Albanian literary world and the mention of his name was forbidden. Virtually all prewar Albanian literature was swept away by the political revolution that took place during and after World War II. Most prewar writers and intellectuals who had not left the country by 1944 regretted their decision to stay. The persecution of intellectuals and the break with virtually all cultural traditions created a literary and cultural vacuum that lasted until the 1960s and whose results can still be felt. With Albania's integration into the Soviet bloc during the 1950s, Soviet literary models were introduced and slavishly imitated. Writers were encouraged to concentrate their creative energies on specific themes, such as the partisan struggle of the "national liberation war" and the building of socialism. Despite the constraints of socialist realism and Stalinist dictatorship, Albanian literature made much progress in the 1970s and 1980s. One of the best examples of creativity and originality in Albanian letters then and now is Ismail Kadare (b. 1936), the only Albanian
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writer with a broad international reputation. Kadare's talents both as a poet and as a prose writer have lost none of their innovative force over the last three decades. His influence is still felt among the young post communist writers of the 1990s, the first generation to be able to express itself freely. 11.. LIVING CONDITION A FOOD AND ECONOMY Food in daily life: After half a century of Stalinist dictatorship, food culture is virtually nonexistent. For decades, there was little on the market beyond basic staples, and today, dire poverty has left most Albanians with little more to eat than bread, rice, yogurt, and beans. In as much as it has survived at all, Albanian cuisine is meat-oriented. Traditional dishes, which usually are reserved for guests and special occasions such as weddings, are easier to find among Albanians living abroad. Food customs at ceremonial occassions: Despite their poverty, Albanians are exceptionally generous and hospitable. A person invited to dinner will be given enough to "feed an army," even though the host may go hungry the next day. It is not unusual for an Albanian family to spend a month's salary to feed a visitor. Meals for guests or for ceremonial occasions such as weddings usually involve copious amounts of meat, washed down with Albanian raki , an alcoholic beverage. Animals were formerly slaughtered and roasted on a spit for religious holidays such as the Muslim celebration of Great Bayram and the Christian feast days of Saint Basil on 1 January, Saint Athanasius on 18 January, Saint George on 23 April and 6 May, Saint Michael on 29 September, Saint Nicholas on 6 December, and Christmas on 25 December. These customs have largely died out, although some regional dishes have survived. The Orthodox of southeastern Albania still eat qumshtor , a custard dish made of flour, eggs, and milk, before the beginning of Lent. During the annual spring festival ( Dita e Vers ), in central Albania on 14 March, the women of Elbasan and the surrounding regions bake a sweet cake known as ballakum Elbasani . Members of the Islamic Bektashi sect mark the end of the ten-day fasting period of matem with a special ashura (pudding) made of cracked wheat, sugar, dried fruit, crushed nuts, and cinnamon.

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B) HOUSING During World II, about 61,000 buildings of all types were destroyed, including 35,400 dwellings. Housing was generally primitive in rural areas and poor elsewhere. After the war, housing continued to be a problem for a variety of reasons: primary emphasis on industrial construction, shortages of materials and skilled labor, and lack of or inadequate assistance for private building. Moreover, the increase of urban population worsened an already desperate situation. Consequently, new housing construction was concentrated in Tiran, Vlor, Elbasan, Shkodr, Durrs, and Kor, as well as in other industrial and mining sites. Nearly 29% of all housing currently available was built during the period from 1961-1980. According to the preliminary results of a 2001 census, there were about 520,936 residential buildings in the country containing about 783,640 dwellings. About 30% of the dwelling spaces were block flats constructed and owned by the government during the Communist era. Most public housing was privatized during the period from 199293. A 1998 Household Living Condition survey indicated that about 74% of rural households did not have an indoor toilet and 54% did not have access to running water. In comparison, 18% of urban households were without an indoor toilet and 5% lacked running water. The most common form of housing construction is a concrete frame filled with brick or block in-fill. C) CLOTHING Traditional Albanian clothing (Albanian: veshjet tradicionale shqiptare, veshjet kombtare, veshjet popullore or kostumet kombtare) includes more than 200 different kind of clothings in all Albania and Albanian inhabited lands. This is due to the division the Albanian principalities in the Middle Ages. To this day, some conservative old men and women mainly from the North wear traditional clothing in their daily lives. Instead, older women from the South usually wear all black outfits. Almost every region in Albania has its own traditional dress with women clothing being particularly colorful and rich in detail. The Albanian Dress consist of the following elements: Headgear Men The following head dresses are in use for men: Qeleshe: a type of hat worn by men of Northern Albanian and Kosova. In central Albania (Tirana, Durrs, Kavaja) it is cone-shaped, and in North Albania and Kosovo round.
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Albanian hat: worn typically during the 15th to 18th centuries[3] and immortalized in Onufri's paintings Fez: a Turkish felt hat where upper flat manner un meischt red manner. Qylaf: a woolen high hat worn in southern Albania.

For Women The following headdress are in use for women: Kapica: a headdress for women. Langi, other names include: peshqira, riza, marham, pashnik Lvere: right shaped headdress. Kryqe : square shaped headdress. Fustanella : raditional skirt-like garment worn by men. Tirq:long pant worn by man. Brekusha: for man and women. Xhubleta: Only worn by women. Mbshtjellse- Only worn by women.

Pants and upper body covers

D) HEALTH CARE IN ALBANIA The Albanian healthcare system is predominately public, centralized and rigidly structured. The State is the major provider of health services, health promotion, prevention, diagnosis and treatments for the citizens. The system often has difficulties in meeting the healthcare needs and requirements of patients. New technologies and developments in medicine are often not available to medical professionals and staff in Albania, especially for those outside the capital. In Tirana, medical care at private hospitals and clinics has certainly improved in recent years, however, medical facilities outside Tirana have very limited capabilities, often providing inadequate standards of care due to a lack of medical specialists, diagnostic aids, medical supplies, and prescription drugs. The private sector is still developing and covers most of the pharmaceutical and dental services as well as some clinics for specialized diagnosis, again mainly being located in Tirana. E) SOCIAL SECURITY CONTRIBUTION

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The Albanian social security system is administered by the Public Institute of Social security, which is under the jurisdiction of the Council of Ministers. The employer contributions include contributions to the work accidents indemnities and unemployment fund. Employees are also liable to a percentage for both health and social security contributions. The pension system in Albania that had been created in the interwar period was after the WW II adapted to the pension model operative in other Soviet-bloc countries. After Albanias return to market economy in 1993, it was modernized and constructed as the pay-as-you-go tier. Only in 2006 was the system modified, in such a way that voluntary payments to III tier were introduced. However, due to the poverty of Albanians and their traumatic experiences one is not inclined to think that this tier will grow at a fast rate. The discussions about the introduction of the second, fully capital public pension tier have not lead to any substantial action. The advantageous demographic situation of the country does not translate into, as could be expected, favourable ratio of those who pay contributions to those collecting pension benefits. This has very much to do with the fact that Albanias agriculture, which is large sector in the countrys economy, meagerly contributes to the pension system. Comparing Albanias pension system to those of other countries, it is worthwhile to notice the special treatment that is given to women who have given birth to six or more children. 12.FOREIGN POLICY Albanian foreign policy since its independence has maintained a policy of complementarism by trying to have friendly relations with all countries. From May 2012, Albania chairs the Council of Europe until November. The Council of Europe has 47 members and for 2011-12 is prioritising: human rights with a particular focus on the child; promoting human rights and the rule of law in the interest of democracy and stability; and strengthening of local and regional democratic processes. Albania is a member of a number of international and regional organisations and initiatives, including NATO, the Organisation for Security and Cooperation in Europe (OSCE), the UN, the Stability Pact, the Atlantic Charter, and the World Trade Organisation (WTO). Albania joined NATO on 1 April 2009, following formal agreement to its accession at the Bucharest Summit in April 2008, and is a contributor of troops to the International Security Assistance Force. Albania applied to become a candidate country for accession to the European Union (EU) in 2009 and is recognised by the EU as a "potential candidate country". In November 2010 and October 2011 the European Commission concluded that Albania had made progress toward accession criteria, but that this was insufficient to
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warrant being granted EU candidate status. The Organisation for Security and Co-operation in Europe (OSCE) has a mission in Albania led by Ambassador Eugen Wollfart. 13 INVOLVEMENT OF ALBANIA IN INTERNATIONA ORGANIZATIONS Albania has association with many more international organizations such as Black Sea Economic Cooperation, International Atomic Energy Agency, and International Fund for Agriculture Development, International Labor Organization, The World Bank, UNESCO, UNICEF, United Nation, United Nations Conference on Trade and Development, WHO, etc. Albania joined the United Nations on 8th of October, 1962. The accession of Albania to NATO took place in 2009. Albania's relationship with the North Atlantic Treaty Organization (NATO) began in 1992 when it joined the North Atlantic Cooperation Council. In 1994, it entered NATO's Partnership for Peace, which began Albania's process of accession into the alliance. In 1999, the country received a Membership Action Plan (MAP). The country received an invitation to join at the 2008 Bucharest Summit and became a full member on April 1, 2009. Albania is currently pursuing a path of greater Euro-Atlantic integration. Its primary long-term goals are to gain EU membership and to promote closer bilateral ties with its neighbors and with the U.S. 14 FOREIGN TRADE The Albanian economy suffers from a trade deficit, albeit a declining one. In 2010, Albanian exports totaled $1.194 billion while imports totaled $3.602 billion which decreased significantly from $4.898 billion in 2009 when exports remained at a similar figure of $1.345 billion. Italy dominates both imports and exports, while Greece is its second two-way trading partner. Albania Exports Albania exports textiles and footwear, asphalt, metals and metallic ores, crude oil, vegetables, fruits and tobacco. Its primary export trading partners Italy are (55.9% of exports), Greece (11.6%), China (7.2%) Italy (27.6%), Greece (14.8%), Turkey (7.4%), China (6.8%), Germany (5.6%), Switzerland (5%) and Russia (4.2%). Albania Imports
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Albania's primary imports include machinery and equipment, foodstuffs, textiles and chemicals. It imports from Italy (32.2% of imports), Greece (13.1%), Turkey (7.2%), Germany (6.6%), China (4.5%), Russia (4.4%) Italy (27.6%), Greece (14.8%), Turkey (7.4%), China (6.8%), Germany (5.6%), Switzerland (5%), Russia (4.2%). 15 MULTINATIONAL OPERATIONS IN ALBANIA With fiscal reforms under way, progress in the fight against corruption, low inflation rates and a negative trade balance, Albania is attracting more foreign direct investments (FDIs) with high profitability and low labor costs. Because of the ability of FDIs to generate jobs and contribute to long-term economic development, the government has made attracting them a priority. Experts expect to see investments mainly in the energy sector this year, as well as the natural resources and tourism sectors. Hydro and thermal power plant construction, along with the privatisation of the state-run electricity distribution division and oil and insurance companies, offer opportunities to foreign companies looking to invest in Albania. FDI IN ALBANIA IN THE GLOBAL CONTEXT. Global FDI inflows doubled in the 2005-2007 period (in nominal terms) but fell back to the 2005 level of 802 billion ($1.1 trillion) in 2009 (table I.1). Inflows to South-East Europe followed the global trend, peaking in 2007. FDI flows to Albania during the period, however, developed mostly independently of the global and regional trends showing a continuous increase, extending beyond 2009. In dollar terms, however, FDI inflows to Albania declined slightly, due to the appreciation of dollar with respect to the euro and the Albanian Lek. The share of FDI inflows to Albania in the world total remains marginal, at 0.1% in 2009, even though it grew to ten times its share in 2000 (figure I.1). The countrys weight as a host to FDI in the South-East European region has, however, grown remarkably since 2006, especially since 2007, when inflows to the South-East Europe decreased while flows to Albania kept growing.

16 INDIA - ALBANIA RELATIONS Diplomatic relations were established in 1956 with the Indian Ambassador resident in Rome concurrently accredited to Tirana. They were suspended in 1964-65. In 1984, Albania signalled its interest for better relations with India and was taken to accredit the Indian Ambassador in Bucharest was accredited concurrently to Tirana, from 27 April 1990. Bilateral political relations
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between India and Albania are cordial and friendly. Foreign Office consultations were held in February 2003 in Tirana and in New Delhi in January 2006. Albania opened an embassy in New Delhi in early 2008. The Foreign Minister and Speaker of Albania paid their first visits to India in 2008 and 2010, respectively. A Protocol on Foreign Office Consultations exists and discussions have taken place on a Double Taxation Avoidance Agreement (DTAA) and a bilateral Investment Promotion and Protection Agreement (BIPA). Bilateral Trade and Investments Trade between India and Albania is minimal, and is dominated on the Indian side by export of Indian pharmaceuticals. Bilateral trade between India and Albania during 2010-11 was US $ 11.70 million (Indias exports were US$ 11.58 million and imports were US $0.12 mn) India also exports coffee chemical industry products; vegetable products; mechanical,electrical machinery and equipment; textiles; tires and plastic products. There are three shops in Tirana that exclusively sell Indian products (fashion garments, furniture, furnishings and souvenirs) imported via Turkey and Greece. India imports chemical industry products and metal alloys. India offers 2 slots annually to Albania under ITEC. Albanian diplomats have trained at the Foreign Service Institute of the Ministry of External Affairs. Albanian TV has telecasting Indian documentaries. Consular matters Visas are now issued by the Albanian Mission in New Delhi. Albanians apply for visas at the Indian Mission in Bucharest. Air links with India Travel routes to Albania from India are through Rome, Frankfurt, Vienna, Istanbul or Dubai. The Indian community in Albania is miniscule (less than 20). Occasionally Indian personnel have been used to complete construction projects. The international airport of Albania is named after Mother Teresa who is regarded as an Albanian national personality.

17 SWOT ANALYSIS FOR INVESTMENT IN ALBANIA STRENGTHS CATCH UP GROWTH POTENTIAL EMERGING MARKET ACCESS TO REGIONAL MARKET (CEFTA)
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GOVERNMENT SUPPORT Liberal model adopted Clear EU prespective Relatively low labor cost Young and skilled labor force Property Rights Corruption Rule of Law Consumer maket Energy power generation Tourism Mining Information Communication Technology Agro business Manufacturing sector Services Euro zone crisis Banking sector Currency Corruption

WEAKNESS

OPPORTUNITIES

THREATS

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