2. In The World Bank’s forecasts of long-term convergence, Albania will reach EU average living standards in 22 years
Income convergence in Europe
The convergence
With economic growth of 6 percent per year, it would take ten years for Albania to catch up with EU11 countries and over 22 years to reach EU average living standards
Expanding the growth potential through structural reforms in a stable macroeconomic environment drives strong income convergence
Source: The World Bank

3. Moreover, Albania’s exports to the EU are estimated at 40% below potential, the highest in the SSE region
Albania’s potential in global trade, mln USD
Albania’s export potential
Albania’s import potential
+49%
7,690
+67%
4,107
5,152
2,464
2013
Potential
2013
Potential
According to The World Bank, Albania’s exports to the EU are estimated at 40% below potential, the highest in the region
Imports from the EU are estimated to be below potential by 33 percent
Source: The World Bank

4. To unlock its growth potential, Albania will benefit from its extensive FTAs with EU and other neighboring countries, which cover a market of over 600 million customers
Can reach any major city in Europe within 3 days by truck
Albania will be part of the EU’s market, the largest in the world, of 620 million customers
CEFTA is a market of 26 million customers
7 million is the size of the Albanian speaking market within CEFTA
Albania is a Member of WTO and applies WTO rules on import licensing
Bringing down trade barriers
Trade agreements with the US
Free trade advantage
CEFTA EU
World
CEFTA 1 EU 2
World 3
Source: Ministry of Economic Development, Tourism, Trade and Entrepreneurship

5. A B C D Export-oriented Growth Competitive Human Capital
Four major reasons to invest in Albania: healthy growth, young workforce, vibrant industries and comprehensive structural reforms A
Export-oriented Growth
Albania’s export has a 24% annual growth rate for the past five years and its trade with many EU countries has been surging B
Competitive Human Capital
57% of Albania’s population is under age of 35 and the average wage is one of the most competitive in the region C
Promising Sectoral Opportunities
Promising industries include manufacturing, energy, agriculture, mechanic industry and tourism D
Comprehensive Structural Reforms
Government is launching major reforms to better share growth with foreign investors
Source: Ministry of Economic Development, Tourism, Trade and Entrepreneurship

6. A
Export-oriented Growth
Albania’s export has a 24% annual growth rate for the past five years, growing from 1 billion USD to 2.5 billion
Albania’s dynamic export sector, mln USD
Total export,
Total import,
+5.4%
+21%
Already as one of the largest sectors, the growth rate of trade is still above average
Import has been declining since 2011
Source: Income statement, investments and macroeconomic variables for all market producers of goods and services , Institute of Statistics of Albania

7. A
Export-oriented Growth
Trade is playing an increasingly important role in Albania, contributing almost half of the country’s GDP in 2012
The importance of trade in Albania’s economy
Albania’s Trade as % of GDP,
Share of total income by sector, 2014
Albania has a dynamic manufacturing sector and an increasingly efficient logistic system, which has boosted the trade sector
Total income from producers of goods and services is 15.3 billion USD
The contribution of industry is growing steadily
Source: The World Bank

8. A
Export-oriented Growth
Thanks to closer economic integration, Albania’s export to Spain, Germany, Italy and other major economies in the UE has surged despite debt crisis
Albania’s export to Western Europe
Spain
Germany
France
80%
+108%
+28%
2009
2010
2011
2012
2013
2009
2010
2011
2012
2013
Albania’s export to Spain is more than doubling every year in average
Albania’s export to Germany is growing fast at 28% per year
Albania’s exports to France have increased 80% from 2009
Source: Export by Countries ( ), Institute of Statistics of Albania

9. 57% of Albania’s population is under age of 35
Competitive Human Capital
In terms of human capital, Albania has a young workforce that are well-educated and highly-motivated
57% of Albania’s population is under age of 35
The median age of Albania’s population is 31.2 years
They are well-educated, highly-motivated
Many can speak English, Italian and Greek
There are over 1,000,000 of them
Source: Ministry of Economic Development, Tourism, Trade and Entrepreneurship

10. B
Competitive Human Capital
Albania has one of the lowest median age in the region, and a well-educated workforce comparatively
Median age, 2010
Average years of schooling, 2012
Kosovo
Bosnia
Albania
Greece
Macedonia
Italy
Montenegro
Serbia
Romania
Bosnia
Romania
Serbia
Albania
Bulgaria
Montenegro
Slovenia
Bulgaria
Greece
Italy
Slovenia
Source: The World Bank, CIA World Factbook; UNESCO

11. B
Competitive Human Capital
Many from the workforce have great language skills and have received professional training
Language skills
Professional training
Workforce availability
Albania’s workforce has proficiency in foreign languages
English, Italian and Greek are widely spoken
French and German included in the education system
Professional Trainings driven by market needs
Vocational trainings and hands on trainings at leader factories in each sector
Flexible structure, to support workforce needs in different regions
Approximately 116,000 students register annually in all the universities
The budget of the National Employment Service will be tripled next year
Support funding available for businesses expanding
Source: Ministry of Economic Development, Tourism, Trade and Entrepreneurship

12. B
Competitive Human Capital
Compared with neighboring countries, Albania’s wage level is the most competitive
Monthly minimum wages in EUR, 2013
Average monthly wage in EUR, 2013
Montenegro
Albania
Albania
Bulgaria
Bosnia and Herz.
Macedonia
Bulgaria
Romania
Macedonia
Bosnia and Herz.
Serbia
Serbia
Romania
Montenegro
Turkey
Turkey
According to the latest minimum wage law of Albania, it is the second lowest in the region
The average monthly wage of Albanian workers is as low as 310 euros
Source: The World Bank; Ministry of Economic Development, Tourism, Trade and Entrepreneurship

13. 1 2 3 4 5 Tourism Agriculture Manufacturing TEDA-s
Promising Sectoral Opportunities
New industries are developing rapidly contributing significantly to exports growth thanks to the new economic model 1
Tourism 2
Agriculture 3
Manufacturing 4
TEDA-s 5
Auto-motive and mechanic
Source: Albanian Investment Development Agency

14. C
Promising Sectoral Opportunities
The government has rolled out the Textile and Footwear Industry Package 2014, giving a strong stimulus to the fashion industry
Albania’s export in manufacturing, mln USD,
New stimulus given to the sector
Significant growth in exports
+18
In 2014, exports in manufacturing increased by 24,6% or 165 million dollars.
5,000 new jobs were created within the year
14% increase in imports of machineries and equipment.
Under the slogan “a new chapter for employment”;
A symbolic rent of EUR 1 when leasing from gov’t;
A one-stop shop dedicated solely to the sector;
Instant reimbursement of VAT;
Simplification of procedures.
Source: Export by Countries ( ), Institute of Statistics of Albania

15. C
Promising Sectoral Opportunities
The government has rolled out the Plastic Industry Package in early 2015
Albania’s export in chemicals and plastics, mln USD,
New stimulus given to the sector
Significant growth in exports
+31
Instant reimbursement of VAT;
Financial support for participation in trade fairs and international.
The exports of the sector have increased by 18% in 2014.
The share of the sector in total exports increased to 1.3% in 2014 from 1.17% that it was in 2013
Source: Export by Countries ( ), Institute of Statistics of Albania

16. C
Promising Sectoral Opportunities
The agricultural sector of Albania has distinct natural advantages and superior market conditions
Albania’s agricultural output, mln USD,
Natural and market advantages
Steady growth in the past five years
+7%
3,330
3,520
3,125
2,646
2,750
2008
2009
2010
2011
2012
Favorable climate
Average 16 degrees in the costal areas
Diverse micro-climate that is suitable for different products
Suitable soil and abundant water
Advantages from preferential trade agreements with EU on the increase in exports
The agricultural sector has grown steadily in the past five years
This sector has not been affected by the European debt crisis
In 2014 the Government launched a new package to support the sector
18% increase in exports within the year.
Source: Albanian Investment Development Agency

17. C
Promising Sectoral Opportunities
Albania has a dynamic sector of renewable energy and tremendous untapped potential of green power
Hydro power
Wind and solar energy
Petroleum and gas energy
Eight large rivers run through the country from the mountainous East to the Adriatic and Ionian seas
To date only 35% of Hydro- Energetic potential of the country is utilized, and total resources are about 4,500 MW
Albania has favorable conditions for development of solar energy – solar radiation is calculated to be more than 1,500 kWh/m2/yr
Albania has an untapped wind power potential, in particular along the Adriatic coast
Albania has significant oil reserves and produced about 1.2 million tons in 2013
Its oil exports to foreign markets at the end of 2012 amounted to 567 million USD, dominating the total domestic exports
Source: Ministry of Economic Development, Trade and Entrepreneurship

18. A B C D E F Macro-economic reform Energy reform Pension reform
Comprehensive Structural Reforms
A new economic model is in place, with focus on production and exports through major structural reforms A
Macro-economic reform B
Energy reform C
Pension reform D
Territorial-administrative reform E
Business climate reform F
Deregulation reform

19. Business climate Tax & customs One Stop ShopD
Comprehensive Structural Reforms
Further business climate reform is taking place in order to better share the growth opportunities with foreign investors
Business climate
Gov’t is increasing the efficiency of tax administration and fight against corruption through the National Economic Council, which operates under the auspices of the Prime Minister. An anti-evasion reform has started on 1st of September 2015
Tax & customs
Corporate tax rate - 15 %
VAT – 20%
Personal tax rate from %
Favorable tax system for Small Businesses - 7.5%
Treaties for the Avoidance of Double Taxation with over 30 countries
One Stop Shop
Introduction of e-registration and electronic notification of balance sheets and financial reports. The registration completed with less than one euro; registration and licensing to be offered through one unique window by 2016
Source: Albanian Investment Development Agency

20. 1 2 3 4 No restriction on capital transferD
Comprehensive Structural Reforms
Furthermore, Albania has no restriction on capital movement and has one of the most competitive tax rates in the region 1
No restriction on capital transfer 2
No restrictions on repatriation of profits 3
Simplified tax procedures 4
Competitive tax rate
Source: Albanian Investment Development Agency

21. Albania’s legal framework on FDI has been designed
to create a favorable business climate for foreign investors
No limitation and full openness
Full protection and equal treatment
Full protection of foreign investment
Foreign investment may not be expropriated or nationalized directly or indirectly, except in special cases, in the interest of the public us as defined by law
Foreign investors have the right to expatriate all funds and contributions in kind of their investment
Equal and unbiased treatment
In all cases and at all times investments will have an equal and unbiased treatment, and will have complete protection
In any case foreign investment will have a treatment equal to what common international practice allows
The implementation of the economic reforms constitutes the main engagement of the Government for the country’s social-economic development, with the final goal of integration with the European Union
No prior government authorization is needed and no sector restrictions to foreign investments
There is no limitation on the percentage share of foreign participation in companies- 100% foreign ownership is possible
Source: Albanian Investment Development Agency

22. Albania’s legal framework on FDI has been designed
to create a favorable business climate for foreign investors
The new Law on Tourism
The new Strategic Investments Law
Tourism is considered a strategic sector, in line with the other legislation on strategic investors
Provides a comprehensive approach for an integrated and sustainable development of tourism
Create areas to be developed by investors, and provide for public – private partnerships
Provide expedited procedures for land acquisition and leases up to 99 years
Introduce international standards and certifications for a sustainable tourist sector
Stimulate and support strategic investments in fast growing sectors
Facilitate administrative procedures, increase transparency, and reduce legislative complexity for strategic investments
Increased predictability and security of state - investor contracts through ratification of contracts by statutes
Expedited due diligence procedure (AIDA completes the due diligence within 30 days of the submission of an application)
Support with the necessary infrastructure
Provision of immovable assets to develop and implement strategic investment projects
Source: Albanian Investment Development Agency

23. 1 2 3 4 5 6 The new law on Technical and Economic Development Areas E
Legal Framework
The new law on Technical and Economic Development Areas 1
Developers and users shall be exempted from 50% of the profit tax rate for a period of 5 years
For developers that invest in the area, within 3 years of commencement of work or the investor that shall invest in the area within 3 years of commencement of the economic activity in the area, the annual capital expenses shall be 20 % deductible, regardless of the sum of depreciation, pursuant to the law on profit tax, during a period of 2 (two) years; 2 3
Supply of Albanian goods, intended to enter the area, shall be considered as a supply for export at zero scale 4
Developer’s project shall be exempted from infrastructure tax; 5
Buildings constructed in the area shall be exempted from real estate tax for a period of 5
years and from tax for transfer of ownership 6
Wages and social costs shall be 150 % deductible for the first year, and new expenses for wages and social costs compared to the previous year are 150 % deductible for the subsequent years
Source: Albanian Investment Development Agency

24. 7 8 1 2 The new law on Technical and Economic Development Areas
Legal Framework
The new law on Technical and Economic Development Areas 7
Training costs for employees and expenses for R&D in the area, shall be doubly deductible for a period of 10 years, from the beginning of operations; 8
Wages and social costs shall be 150 % deductible for the first year, and new expenses for wages and social costs compared to the previous year are 150 % deductible for the subsequent years;
Procedural and administrative incentives 1
Shortens the application period to up to 15 days from the submission of the
application 2
Provides guaranties for the investor against financial consequences caused by changes in the legislation for a period of 10 years
Source: Albanian Investment Development Agency

25. TEDA - SPITALLE Duration for the operation of the TEDA Area: 501.9 ha
Manufacturing – industrial and agro-processing
New innovative industries with high – tech
Energy-efficient industries
High-productivity industries
IT activities
Automotive spare parts, construction materials etc.
Commercial and goods storage
Services (Administration, Banking, Customs, Health-care, legal, insurance companies, notaries etc.)
Transport activities
Support logistics
Duration for the operation of the TEDA
99 years
Area: ha

26. TEDA - SPITALLE
Located close to the city of Durrës, the second most developed city in Albania
6.4 km from the port of Durrës, the biggest and most important port in Albania
30 km from Tirana International Airport “Mother Teresa”
37 km from the capital city of Albania, Tirana
Contract Notice was published on the Procurement Agency on 24/08/2015 and FT on /
Deadline for submission of offers: 28/10/2015
Standard bit documents on:
Area: ha

27. Visit us at teda.gov.al

28. Touristic development & investment project at Gjiri i Lalezit by Omnix Albania 2017 - 2022
Total value of investment: US$1.2 billion
Five Star Luxurious Hotel & Spa, 250 keys, conference hall 500-seats.
Retail Boulevard, Leisure & Entertainment zone includes food & beverages outlets, cafes, dining and boutique shops.
Atlantis 3,200/day capacity Aqua park and treasure island (allocated 450 car parks)
Themed park, dry sports area, adventure golf, children’s birds park.
500 Residential luxurious apartments.
1750 car lots
1430 jobs generated
1050 monthly payroll
380 indirect services related to the development project
Start of project 2017 – End of project 2022

30. Overall Master Plan

31. Investors already present in Albania
Source: Albanian Investment Development Agency