“We believe that this year will continue [with weak sales] despite some promising signs,” Ilir Hebovija, the deputy director of the Association told to News 24 TV.

“Prices had been slashed b y 10-15 per cent and the fall is higher in the periphery of Tirana but still the demand remains weak,” he added.
Albania saw a boom in construction during the last decade caused by very low housing stock inhered by the Communism and by banks eagerness to build up the mortgage sector.

The International Financial Crisis that started in 2008 cooled down prices and demands. Several construction companies had cut investments and several new apartment blocks remains unfinished.

Banking system earnings reached 1.5 BN leks, (10.5 million euro) for the fourth month period from January to April 2001, a 47 per cent fall compared with the same period of the previous year.

Underperforming loans jumped to 15.2 per cent of the portfolio at the end of April from 14.7 per cent in March and showed a 27 per cent increase compared with 2010.

Underperforming loans were the main reason for the sluggish profits since banks activity continued to grow during the period. Assets reached for the first time 1 trillion lek (7.2 billion euro) as result of deposit increase. Deposits reached 841.1 BN leks or 5.9 BN Euro, a 13.8 per cent increase compared to the previous year. Individual customers increased their deposit holdings in the banks by 16 per cent while corporate customer deposits remained unchanged. Loans portfolio increased by 8.6 per cent to 510 BN leks (3.59 BN Euro) in April.

Mounting underperforming loans indicates continued difficulties among businesses and mistakes made by banks during the big loans boom in Albanian economy experienced between 2004 and 2007.

Albanians show their tendency to save during this period while the domestic consumption had remained very weak during the last year.

Albania exports totaled to 478 million euro for the January-April 2011, from 347 million in the same period 2010. Exports of energy and base minerals increased by 55 per cent this year as commodity prices jumped in the international market.

Bankers Petroleum, a Canadian based company that operates Albania oilfields, reported 107 per cent revenue increase for the first quarter 2011. Energy and minerals contributed to 31 per cent of the country’s total exports.

High growth was reported as well from textile and footwear industry, which reported 19 per cent growth in exports. The share of construction materials and metals in exports increased this year to 22 per cent from 18 per cent this year due to increased exports of cement.

Imports increased by 17 per cent to 1171 million euro while trade deficit increased by 6 per cent to 693 million euro this year, data from INSTAT shows.

Besar Likmeta Tirana
“Although there was growing confidence from business in the industry and construction sectors, their gains were offset by the negative impact of consumer and services confidence indicators,” the Bank said.
The index, which compiles data from 13 business and consumer indicators, was 14.7 points below its long-term average.
The consumer confidence index fell for the third quarter in a row, based on lower performance on expenditures for large consumer goods and the worsening of current economic situation indicators.
According to the Bank, the survey shows that consumers believe that the cost of living became more expensive in the first three months of 2011, compared with the same period of last year, while prices are also expected to rise in the next quarter.
The services sector registered a sharp fall as well this quarter, with the general conditions of businesses and employment and the financial situation contributing to the negative perception of the economic situation.
“The political climate and the security situation in the country have had a major negative impact on the sector,” the Bank said.
Although confidence in the industrial sector has grown, based on a stronger showing from banks, “corruption and the informal economy” continue to impact it negatively.
However, the expectations for industry in the second quarter are generally optimistic, citing an expected growth in internal demand and exports.
The indicators for business confidence in the construction sector also registered growth for the second quarter in a row, coming just 4.7 points shy of its long-term average.
A rise in production and demand seemed to be the main drivers in the construction sector; however the rate of use of its capacities remained at 61 per cent.
Investments by businesses in both the construction and industrial sectors were targeted at replacing old or damaged equipment and installing new technology.

Source: Balkaninsight

Besar Likmeta, Tirana
CampaignDefending his decision to return the bill to parliament, the president said that changes to the bill that would pass the management of fiscal stamps system into private hands is in breach of the Stabilization and Association Agreement, SAA, with the EU.
“This bill would change the tariffs in place at the time of the entrance into force of the SAA,” the president said in a statement, defining SICPA’s costly stamps as a tax imposed on imports. “Since the entrance into force of this agreement no new tariffs can be imposed on imports and exports,” he added.
The proposed law would have opened the way for a deal between the Ministry of Finance and the Swiss firm SICPA Securities to provide the stamps.
An investigation by Balkan Insight, published in October, showed that the multimillion-euro tax stamp scheme, aimed at fighting Albania’s illegal tobacco and alcohol trade, would be costly and ultimately ineffective.
It found that the new fiscal stamps system supplied by SICPA Securities is not in line with international agreements on combating the illicit trade in tobacco products.
Moreover, the system has no track record of reducing smuggling in the countries where it has been applied and whether it is the right solution for the local market also remains open to question.
The government, meanwhile, says this “track and trace” technology will help fight contraband trade in cigarettes, spirits and other products, bringing in much needed revenue.
However, tobacco companies have complained that the tender to award the exclusive contract was not transparent. Contacted by Balkan Insight in October, SICPA declined to comment on the allegations.
The deal with SICPA to provide revenue stamps for the Albanian government through its SICPA Trace system, at 14.4 euro per 1000 cigarettes over a period of ten years, is twice as expensive as rates offered to other countries for the same system. The same company offered the Philippines the same system a year ago, at $7 per 1000 cigarettes.
In his response to MPs on Wednesday, the president also argued that the proposed agreement could have a negative impact on Albania’s local businesses, which eventually would trickle down to its workforce.
“This bill not only raises the costs of production of the local industry, but also could bring about negative effects for its employees, who could eventually lose their jobs,” Topi underlines.
Source: Balkaninsight

After completion, envisaged for 2012, the complex stretching over 20,000 square metres should have some 200 modern apartments and studio flats.

“The location is exclusive, offers a beautiful view and is close to the down town area,” the project manager Peter Roth told local media.

He explains that his company hopes to attract exclusive buyers such as politicians and stars who are in need of high standards of living and the additional commodities like a security guard service that will watch over the complex.

The settlement will also include a hotel, restaurants, wellness and spa centre and various other leisure facilities, the investors say.

With its business endeavors in Austria, Bulgaria, Estonia, Latvia, Romania, Serbia and Slovakia, Soravia is one of the top real estate developers in the region.

The company already owns and operates a business centre in the Macedonian capital.
Source: Balkaninsight

Metal firm Ferronikeli, one of Kosovo’s biggest companies, is importing lignite from the other side of the world because it cannot access the country’s rich reserves of brown coal.

Balkan Insight has discovered that the ferronickel exporter has been forced to sign deals with Malaysia and Indonesia to import lignite to its plant in Drenas.

Kosovo has about 14,700 million tonnes of unexploited lignite, worth some 120 billion euro, which is estimated to be the fifth largest reserve of brown coal on the planet.

But Kosovo’s current mines are soon to run out of coal and Ferronikeli, which was bought in 2007 by IMR/Alferon as part of Kosovo’s privatisation programme, complains that the lignite which is available cannot be used.

Arten Bajrushi, spokesman for Ferronikeli, told Balkan Insight: “Even early on, and still today, we have imported lignite from other countries of the world. We have agreements with Indonesia and Malaysia to import lignite.”

He added that only a very small amount of lignite is taken from KEK, Kosovo’s national energy provider, because the publicly owned firm cannot provide enough lignite, and that the coal it can provide is ‘too wet’ for Ferronikeli to use.

Bajrushi said: “Lignite that KEK uses for electricity is 38 per cent wet, while for our technological processes lignite needs to be only 18 per cent wet.

“This issue was supposed to be solved by a drying facility that KEK does have, but it does not work most of the time,” said Bajrushi.

He added that KEK’s organisational problems mean that it is cheaper for his firm to import coal from thousands of kilometres away rather than buy it in Kosovo.

Transporting from South East Asia remains cheaper, even though coal is shipped to Greece, as Albania and Montenegro do not have the capacity to take large cargo.

“The ports of Albania can only take 10,000 tonnes of coal, while the Greek ports can take 50,000 tonnes of coal, of which 10,000 goes to Ferronikeli and the rest is taken by other companies,” said Bajrushi.

He hopes that with the privatisation of KEK, the situation will improve, as currently only KEK has the right to sources of energy.

But officials at KEK told Balkan Insight that it does not have the right to sell lignite. According to Viktor Buzhala, KEK Spokesman, only Kosovacoal KC, a subsidiary of KEK, has the right to sell lignite.

He refused to comment on why the drying facility doesn’t work, pointing Balkan Insight towards KosovaCoal. No officials at the firm responded to questions.

Kosovo is currently using just 2 per cent of its coal stocks at the Mirash and Bardhi mines, which are soon to be exhausted.

Economic experts believe that Kosovo must quickly open new lignite mines, which would be able to supply Ferronikeli and other firms.

Azem Rexhaj, who is executive director of the Independent Commission of Mines and Minerals, ICMM, said: “There are two options for Ferronikeli to receive its lignite from Kosovo – one is for it to be supplied by KEK, and the other is for Kosovo to open a new lignite mine.

“Kosovo’s lignite is good enough quality to suit Ferronikeli. This can be seen by the fact that between 1985 and the beginning of the war, Ferronikeli used this type of lignite,” said Rexhaj.

He urged the government to take the necessary measures to open a new lignite mine.

“With the opening of a new mine, we will have the opportunity to extract sufficient lignite, will also create new jobs and will stop the import of lignite that wastes several million euros a year,” said Rexhaj.

Lignite reserves are plentiful in the Dugagjini and Drenica area of Kosovo, near the Ferronikeli plant, and can easily be exploited, he added.

Kosovo’s government has decided to deal with the situation by opening the Sibovc mine, which can supply coal for 40 years.

“Workers are moving fast to make the opening of the mine happen. We think that our first coal from this mine will arrive in the middle of next year,” said Arben Gjukaj, Managing Director of KEK.

The new mine is being opened to supply Kosovo’s new power station, Kosova e Re, which has been dogged by delays.

It is not known whether coal from this mine will be supplied to Ferronikeli or when the drying facility will begin to work again.Source: Balkaninsight

A businessman with close ties to Prime Minister Sali Berisha, Taci viciously assaulted publisher and journalist Mero Baze on Monday evening in Tirana, following a series of reports accusing the businessman of tax evasion.

He is known as one of the Tirana businessman in Prime Minister Berisha’s inner circle. His other company, Taci Oil International has spent millions of euros organising charity football matches, with the proceeds donated to a children’s charity ran by Berisha’s wife.

Baze had ran a series of critical reports on his TV Show, Faktor Plus, on Vizion Plus TV accusing Rezart Taci and his company, the ARMO oil refinery of massive tax evasion.

Apart from the TV show, Baze also publishes the Tirana daily TEMA, a publication very critical of the government.

In a statement to the Commite to Protect Journalists on Thursday Taci denied any wrongdoing.

“I totally deny the allegations that I participated in the brutalities that have caused severe injuries to Mr. Baze. I not only deny my involvement, but I also condemn violence that so often mars our modern society,” he wrote.

The attack, which happened in the presence of two other journalists and other witnesses in Tirana bar, has been condemned by local politicians, diplomats and national and international media organisations.

“The assault of journalist Mero Baze on Monday, in one of the bars of the capital, is a grave and ugly act; unacceptable for a free society,” said Berisha in a statement on Tuesday.

Berisha called on law enforcement authorities to bring the culprits before justice. “Ill-treatment and pressure against journalists its grave and unacceptable for the Albanian government,” the statement added.

The assault was also condemned by the US Embassy in Tirana. “The United States Embassy was appalled by the assault of journalist Mero Baze on November 2,” the embassy said in a statement.

“Physical attacks on journalists and other forms of media intimidation cast a shadow over freedom of the press [and] all forms of pressure and intimidation of the media are unacceptable,” the statement added.

“Such use of violence is intolerable,” Reporters Without Borders said on Thursday. “It shows that certain businessmen who are allied with the government think they are all-powerful and do not have to account for their activities. We hail the universal condemnation this attack has received from the political class and the rapid police response, which suggests there is a will to put an end to impunity.”
“The fact that those involved in this incident are well known should help make people aware of the problem and encourage a debate about the press freedom situation in Albania,” the press freedom organisation added. Source: Balkaninsight

Berisha told a regional conference on financial stability in Tirana that the euro is becoming a major issue “because this currency, supported by the biggest economy in the world, is exerting pressure on our [local] currencies”.

“I believe that the day on which we will surrender and will stop our fight against the euro is near, because we have no other way than to accept inclusion in the eurozone,” the Albanian leader added, as central bank governors from Serbia, Bosnia, Montenegro and other regional states looked on in silence.

“This is our destination, but when I see that even the British eurosceptics have begun to think differently on the euro, then you can imagine what kind of pressure that exerts on us,” he added.

Analysts have taken Berisha’s statement with a pinch of salt, arguing that inclusion in the eurozone is impossible at this stage in Albania’s development.

“Theoretically it is a good idea, but practically it is impossible,” says Ornela Liperi, chief editor of economics weekly Monitor.

According to Liperi, the Albanian government’s fiscal policy management record suggests that it is actually heading in the opposite direction, by amassing a large budget deficit.

“Albania is a developing country, which needs investments, and investments require loans and [a] deficit, and this is not compatible with the conditions a country should meet to join the euro,” she added. Source: Balkaninsight