“The political situation in Albania is currently overcharged,” says Wolf Theiss Partner Sokol Nako, commenting on the opposition’s decision to leave the parliament earlier this year, which led to widespread protests.
Nevertheless, Nako says that he hopes the disputing political parties will find a “breakthrough to work together, to diffuse tension, and make everything possible to speed up the process of the EU integration.” He adds, “hopefully, this situation will not distract any investors from seeing us as a lucrative market and going forward with some major investment plans.”
In the meantime, the country’s economy is not stagnant, Nako reports. In fact, he says, lawyers are busy closing transactions. He points to consolidation in the banking sector tied to the exit of Greek banks such as Piraeus Bank and NBG, which he says is connected to developments in their home country. “We have seen Albanian investors taking on these opportunities,” he says, speaking specifically about the Balkan Finance Investment Group’s acquisition of Piraeus Bank's local subsidiary. He pointed to developments in the telecommunication sector as well.
In addition, Nako says, the Albanian government has recently launched a number of new private-public partnerships to follow on the ones from last year to further improve Albania's infrastructure and boost capital spending in the economy.
Yet the change that is most likely to affect the markets, Nako says, is in the energy sector. At the beginning of May, 2019, the Albanian government decided to establish an electric power exchange. The effort is supported by the International Finance Corporation and the Energy Community Secretariat and is designed to increase efficiency, transparency, and financial responsibility among all participants and stakeholders in the country's energy sector, and potentially improve circumstances in Albania's neighbors as well, says Nako. According to him, subsequent steps will involve the enactment of relevant legislation that will make it possible to establish the power exchange and make it operational. “This will allow suppliers and customers to get the best prices, as well as keeping the market liquid,” he says, adding that if the process is successful it is likely to lead to regional electric power exchange.