Key Points:

    * Albania’s rich natural resource base provides the opportunity
      Albania lies in the Alpine Orogenic belt. Its geological setting provides a wealth of minerals, notably chromite, nickel, copper, zinc and iron. Under its long communist regime, Albania was the principal European chromite producer ranking second in the world by exports. However, that regime largely ignored the potential for other base and precious metals normally associated with copper deposits.

    * Years of underinvestment requires new external private capital
      Although mineral exports were the main source of foreign currency for the communist regime it did little to maintain or develop its asset. Economic turmoil in the mid-90s compounded the problem and by 2000 chromite production had fallen to one-tenth of its peak level – achieved during the communist era.

    * Economic reform programme underway
      The IMF, World Bank and other international agencies have active investment programmes aimed at facilitating the transition from the decades of communist rule. Economic reforms are underway and the legal system is being overhauled, notably in the area of property law. The Mining Law was rewritten in 1994 under the guidance of the World Bank.

    * Still a long way to travel
      Beyond the capital of Tirana lies still an agrarian economy in the grips of high unemployment. Per capita income of US$6,300 ranks Albania 125th globally, just below Algeria. Human trafficking is a problem that places the country on the US State Department’s Tier2 Watch List and land mines, a legacy from the war in Kosovo, afflict some 120km of the border.

    * Invitation to join NATO a sign of coming in from the cold
      Sufficient progress has been made in most areas for NATO, earlier this year, formally to invite Albania to begin accession talks. Albania is also an EUaspirant country with expectations of membership in the 20-teens. Moody’s granted its first ratings to Albanian sovereign debt in 2007. The Ba1 puts its foreign-currency denominated bonds in the same company as Bahrain and the Philippines – a clear sign of Albania coming in from the cold.

http://objectivecapital.co.uk/c/ocuk/articles/081008-396.asp?oid=FA1