The Fund was established in 1994 as part of a US initiative to encourage and develop the private sector in the transition countries of Eastern Europe. The programme was seen as an alternative to direct foreign assistance, avoiding the entanglements of traditional administrative bureaucracy.

The AAEF not only provides financial aid but functions as a direct investor, helping to finance profitable businesses in various sectors of the economy. Over ten years, the Fund has made 62 investments in 25 Albanian companies. In this way, it has doubled the initial capital provided by the US government. Companies financed by AAEF have contributed as much as $419m to the country's GDP, creating over 2,700 job opportunities.

Success has been achieved despite initial difficulties, says AAEF board chief Michael Granoff, citing obstacles that existed during the first five years. These included "an unsafe environment due to pyramid schemes, widespread corruption and poverty," Granoff says.

Over the past ten years, the AAEF's largest investments have been in modernising Albania's Mother Teresa International Airport and establishing the American Bank of Albania (ABA). The ABA, which opened on 24 September 1998, aims to provide the Albanian market with banking services that are at a standard comparable to those in the United States.

"Our main aim was to create more job opportunities and also to encourage the free private initiatives", says AAEF honorary president Dominic Scaglione.

The AAEF is a non-political, US corporation established pursuant to the Support for East European Democracy Act of 1989. It was incorporated in 1995 and maintains offices in New York and Tirana.