Lithuanians worry about fallout from Belarus sanctions
INTERVIEW: “The weekend’s protests were the Russian people's, not the opposition’s” – Maxim Reznik
Western Balkans citizens legally resident in EU equal to 14% of region’s population
International Ice Hockey Federation (IIHF) has stripped Belarus of the right to hold the World Championship this year
Russia's Sberbank makes a move in e-commerce with Goods.ru deal
Putin strikes a conciliatory tone in his World Economic Forum speech but warns of an “all against all” fight if tensions are ignored
OUTLOOK 2021 Russia
@russian_market sacked by UBS for supporting Navalny
Public support is collapsing for The People’s Servant Party
Ukraine’s industrial output jumped 4.8% y/y in December
State-owned Ukrgasbank signs off on convertible €30mn IFC loan ahead of its privatisation
National Bank of Ukraine retains a key policy rate at 6%, the outlook of the CPI deteriorates
Estonia's two big parties agree on grand coalition
VISEGRAD BLOG: Central Europe's populists need a new strategy for Biden
LONG READ: The oligarch problem
China to be excluded from Czech tender for new Dukovany nuclear unit
Czech billionaire Kellner´s PPF makes another bid for Moneta Money Bank
Czech MPs pass protectionist food law in violation of EU rules
M&A in Central and Eastern Europe fell 16% in value in 2020, says CMS report
Hungarian government plans to regulate big tech to stop 'ban' on rightwing views
Hungarian vehicle makers hit by supply chain shortage
Protests sweep Poland after government launches near-total abortion ban
Polish parcel locker operator InPost soars in Euronext Amsterdam debut
Polish industrial production continues boom in December
OUTLOOK 2021 Slovakia
BRICKS & MORTAR: Rosier future beckons for CEE retailers after year of change and disruption
FDI inflows to CEE down 58% in 1H20 but rebound expected
BALKAN BLOG: Only better waste management can clean rivers of trash
Pandemic pushes public debt close to 80% of GDP in Albania and Montenegro
BALKAN BLOG: Superstition and resentment surround vaccination plans
Albania needs reforms for e-commerce to thrive, says World Bank
Bosnia's exports in 2020 amounted to BAM10.5bn, trade deficit to BAM6.3bn
Bulgaria’s latest nuclear u-turn
Retailers and restaurant owners threaten protests in Bulgaria if reopening is delayed
Bulgaria's Biodit first company to IPO on new BEAM market
Spring lockdown caused spike in online transactions in Croatia
ING: Growth in the Balkans: from zero to hero again?
Labour demand down 28% y/y in Croatia in 2020
Kosovo’s biggest opposition party risks being unable to run in general election
OUTLOOK 2021 Moldova
Storming parliaments: New Europe's greatest hits
World Bank revises projection for Moldova’s 2020 GDP decline to 7.2%
Montenegro’s special prosecution probes finance minister over €750mn Eurobond issue
North Macedonia’s state-owned loss-makers await new owners
North Macedonia plans to cut personal income tax in IT sector to zero in 2023
Romanian cybersecurity company Safetech floats shares amid rising investor interest
Romania government to pursue “ambitious” timetable for justice reforms
Private finance mobilised by development banks up 9% to $175bn in 2019
EBRD and WBIF support fast broadband in rural Serbia
Slovenia plans region's longest-tenor Eurobond
Slovenian crypto payment system enters Thai market
Slovenia’s economic sentiment indicator up 2.2 pp m/m in January
Slovenia lost €10bn by neglecting wood industry for decades
Turkish groceries delivery app Getir goes online in London
D’S Damat franchise deals ‘show Turkey’s hard-pressed mall operators becoming their own tenants’
Turkey’s benchmark rate held as concerns over faltering recovery come to fore
Following war with Armenia, Azerbaijan gains control of lucrative gold mines
CAUCASUS BLOG : What can Biden offer the Caucasus and Stans, all but forgotten about by Trump?
Armenia ‘to extend life of its 1970s Metsamor nuclear power plant after 2026’
OUTLOOK 2021 Azerbaijan
OUTLOOK 2021 Georgia
“Try me” not telecoms minister Iran’s president tells hardliners in internet row
Iran’s President Khamenei menaces private citizen Trump
Iran’s technology minister indicted for failing to properly implement internet censorship
No US move to rejoin Iran nuclear deal imminent, say Biden national security nominees
COVID-19 and Trump’s indifference helped human rights abusers in 2020
Central Asia vaccination plans underwhelm, but governments look unruffled
Fears of authoritarianism as Kyrgyz populist wins landslide and backing for ‘Khanstitution’
COMMENT: Mongolia is an island of democracy
OUTLOOK 2021 Mongolia
Mongolia's PM quits amid protests over treatment of mother with coronavirus and newborn baby
Mongolia's winter dzud set to be one of most extreme on record says Red Cross
Tajikistan: Writing for the president is on the wall (and then scrubbed off)
OUTLOOK 2021 Turkmenistan
Turkmenistan: How the Grinch stole New Year
COMMENT: Uzbekistan is being transformed, but where are the democratic reforms?
Download the pdf version
The Albanian coastal city of Vlora, where the Adriatic Sea merges with the Ionian Sea, is a major industrial hub as well as tourist destination. Like much of Albania, its infrastructure needs are large and it is not only the likely destination for Albania’s second airport – if an investor can be found – but also the site of a planned 400-berth marina.
Controversy surrounds the latter project after local media revealed that the infrastructure ministry has launched a tender offering a 35-year concession for the port of Vlora, that will include construction of the new marina. The project was proposed not by the government or municipality but by a company, as yet unnamed, interested in taking on the concession, in what has become common – albeit much criticised – practice in Albania in recent years as the government led by Prime Minister Edi Rama seeks to mobilise private investment through public-private partnerships (PPPs) for much needed infrastructure projects.
The debate erupted again in recent weeks, when President Ilir Meta rejected the budget for 2021 put forward by Rama’s government, citing PPP projects among his objections.
The main problem with the Albanian take on the PPP concept, as repeatedly pointed out by the International Monetary Fund (IMF) and other international financial institutions (IFIs), is that many of the PPP projects that went ahead followed unsolicited bids where a private company approached the government with a proposal, rather than a tender being launched based on an assessment of needs by the authorities. Moreover, the companies that proposed the projects are typically given bonus points when considering bids, which have almost invariably led to that company winning the tender.
In September 2020 the IMF made the point yet again: “There is an urgent need to strengthen public investment management and the quality of spending. Projects should be taken from a pipeline that has gone through a rigorous preparation, assessment and prioritisation process, and will contribute sufficiently to an inclusive recovery. We reiterate our call to establish a unified process for preparing, prioritising and evaluating all public investment projects, including public-private partnerships [PPPs]. The use of unsolicited PPPs should continue to be prevented.”
The IMF added that fiscal risks are increasing in Albania and need to be carefully monitored and managed. “Strong efforts are needed to rigorously assess and manage not only the direct budgetary impact but also contingent liabilities stemming from PPPs,” it said.
The European Bank for Reconstruction and Development (EBRD) head of Albania, Matteo Colangeli, told bne IntelliNews in an interview back in 2018 that a “PPP should share risk between the public and the private sector, and should be run transparently through a transparent process”.
The way the financing tool is used in Albania, he added, is “not ideal, because the government is not really exercising its role of privatising projects; what gets tendered is what [is] offered by those who are interested in developing a project. The role of strategic planning of priorities is missing.”
The EBRD went on to criticise such projects in its 2019-20 Transition Report, where it said that improving the conduct of PPPs required “urgent attention”. Large unsolicited PPPs continue to be awarded, particularly in the road sector … without a sufficient level of cost-benefit analysis and competition in the tender process. This increases the potential social cost and exposes the government to implementation risks, also given the general lack of track record and financial standing of the chosen bidders relative to the scale of the projects tendered.”
Among the more controversial unsolicited PPP projects are the major road projects singled out by the EBRD, namely the Milot-Balldren and Orikum-Llogara sections. Another was the plan to raze the old National Theatre in Tirana to make way for a new theatre building. Faced with fierce opposition, that project was eventually funded from the public budget instead.
Following widespread backlash from both IFIs and the Albanian opposition, in September 2019 the parliament passed legislation banning PPP projects based on unsolicited proposals in the road sector, though they are still allowed for ports and airports as well as in the energy sector. The new legislation also ended the awarding of bonus points to the company that proposed the project.
Moreover, at the end of December, the Central Electoral Committee (CEC) banned the launch of any new concessions including PPP projects that were not previously announced in the four months before the April 2021 general election.
Albania’s main opposition parties, the Democratic Party and the Socialist Movement for Integration (LSI) – both of which have an extremely adversarial relationship with Rama’s Socialists – have been highly vocal in their opposition to PPPs which they claim are enriching a handful of oligarchs close to the ruling party.
Democratic Party leader Lulzim Basha wrote on his Facebook page on December 30 that Albania’s wealth is “concentrated in the hands of the oligarchs”. Rama’s decisions, he added, “have always favoured four to five oligarchs”, and over €2bn has been “dedicated to PPP concessions received by those oligarchs”.
After rejecting the 2021 budget, Meta expanded on his objections to the government’s use of PPP on December 15 when he wrote on Twitter: “The total value of PPP contracts in 2021 amounts to 838.2 BILLION [Albanian lek] ALL or 49.8% of GDP. Whereas for the fight against COVID-19 are foreseen 14.5 BILLION ALL or 0.86% of GDP.”
The PPP situation is disappointing because there were high hopes from the new Socialist government led by Rama, who has done much to push Albania towards EU accession, including initiating judicial reforms, as well as a wide-reaching anti-corruption programme. The government also with great fanfare virtually wiped out drug cultivation at the village of Lazarat – dubbed Europe’s “marijuana mountain” – just before gaining EU candidate status in 2014.
Yet since then, there have been reports that drug cultivation and trafficking have crept up again. A 2020 report from the Global Initiative against Transnational Organised Crime looking at illicit financial flows in Albania, Kosovo and North Macedonia found that far from the drugs industry being in retreat, the transit trade in drugs is estimated to be worth more than half a billion euros each year in Albania. The report also honed in on public procurement, pointing to recent investigations which showed that €300mn is lost annually to abuses in public procurement procedures, nearly 45% of the total bid value of public contracts awarded in 2019.
here to continue reading this article
and 5 more for free or purchase
12 months full website access including
the bne Magazine for just $250/year.
Register to read the bne monthly magazine for
Password could contain only
and have 8-20 symbols length.
Please complete your registration by confirming your
A confirmation email has been sent to the email
address you provided.
can't be empty.
No user with
this email address.
Access recovery request has expired, or you are using
the wrong recovery token. Please, try again.
Access recover request has expired.
Please, try again.
To continue viewing our content you need to complete
the registration process.
Please look for an email that was sent to
with the subject line
"Confirmation bne IntelliNews access". This email will have
instructions on how to complete registration
process. Please check in your "Junk" folder in
case this communication was misdirected in your
If you have any questions please contact us at firstname.lastname@example.org
Sorry, but you have used all your free articles fro
this month for bne IntelliNews. Subscribe
to continue reading for only $119 per year.
Your subscription includes:
For the meantime we are also offering a free
digital weekly newspaper to subscribers to
the online package.
Click here for more subscription options,
including to the print version of our
flagship monthly magazine:
Take a trial to our premium daily news
service aimed at professional investors that
covers the 30 countries of emerging
For any other enquiries about our
products or corporate discounts please
contact us at
If you no longer wish to receive
Magazine annual print
Website & Archive
Combined package: web
access & magazine print
Take a trial to our premium daily news service
aimed at professional investors that
covers the 30 countries of emerging Europe: