The social development bank for Europe

From the Alps to the sea: Supporting Albania to develop

Funding from the CEB has been enabling the Albanian Development Fund (ADF) to transform urban and rural areas in parts of Albania since 2014. A large-scale investment programme has supported sustainable and cohesive socio-economic development in areas of the Albanian Alps and South Coast.

Vlora, AlbaniaBetween the end of the Second World War and the early 1990s Albania was largely isolated. While this had benefits in preserving the country’s natural beauty, extremely limited economic investment and poor infrastructure severely hindered Albania’s development.  

This was particularly the case in the Albanian Alps and the rugged South Coast along the Ionian Sea. Over the decades, these areas experienced a deterioration in their already poor living conditions, as well as net emigration. However, because these regions remained undeveloped, they have become unique refuges for rare plant and animal species that have been lost elsewhere.  

Sustainable development in the Alps and South Coast

Tamare, AlbaniaIn 1993 the Albanian Government, in an agreement with the World Bank, created the ADF, a public agency that manages socio-economic development projects financed by the Government and other donors.

The CEB began working with the ADF in 2001 with a project to secondary roads and communal infrastructure, co-financed by the World Bank. Since then, CEB has implemented three additional projects with the ADF: LDs 1594 (2007), 1665 (2009), and 1853 (2014), totalling € 1.5 billion overall with € 80 million in CEB loans.  

In 2014 the CEB approved a programme loan of €28.7 million to support transformational development projects in the Albanian Alps and South Coast. Financing sources also included a €6 million contribution from the Government of Albania and a €1 million Western Balkans Investment Framework grant. The CEB also contributed a €1 million CEB Social Dividend Account grant to cover implementation and technical assistance costs, including design, supervision and project management.  

The principle aim of the ADF in its programme of work  has been to promote local development by improving public infrastructure while respecting the environment and preserving cultural and historical heritage. Given the importance of the areas in supporting endangered species, promoting sustainable tourism has also been a key focus.  

Dhermi, AlbaniaHow has CEB funding been used?

The ADF programme has been hugely wide ranging and transformative, facilitating the construction of new, or the rehabilitation of existing, roads, sewage networks, water supplies and waste management systems, as well as recreational facilities and green spaces.  

On the South Coast  

Vlora municipality

CEB funds are helping to implement the region’s strategic plan, which aims to develop Vlora as a sustainable gateway for tourism. It is the second largest port in Albania, and work began on a new international airport.  

Investment works co-funded by the CEB loan include:

  • road construction/reconstruction, including construction of the Vlora ring road and rehabilitation of the public area in front of the Vlora waterfront promenade road
  • reconstruction of the road from Vlora to the historic Kanina village
  • reconstruction of Vlora’s main boulevard; this is expected to transform the city as a tourism destination, provide more pedestrian areas and encourage private retail and business investment into the area.  

Environmental sustainability is central to the regeneration programme, with a focus on creating green spaces and promoting green transport options; some 11km of cycle lanes have been created.  

Strengthening the local capacity to develop tourism is critical for sustainable economic development. The Albanian-America Development Fund is supporting the municipality to establish a tourism improvement district in the historic city centre, and Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) is supporting the creation of a tourism information centre. 

Valbona, AlbaniaIn the Alps

Margegaj municipality

Traditionally the inhabitants of the villages of Valbona and Rragam in the Margegaj municipality of the Albanian Alps had to collect their water from natural resources near their homes. A CEB-funded project created a 23km water distribution network, delivering fresh, safe water into people’s homes. The total project value is approximately €373,000.  

Puka

Puka is a small Alpine town that sits over 800m above sea level. CEB funds have been used to transform the town square, the tourist hotel, the facades and roofs of buildings, and many other projects, making this Alpine town more attractive, welcoming and accessible. In fact, in 2019, a record-breaking number of tourists visited this revitalised town.  

“Over 80 projects have contributed to transform Puka. It is a radical change that has affected the welfare of locals,” says Gjon Gjonaj, mayor of the municipality.  

Vuno, AlbaniaCreating a positive legacy

What have been the outcomes of these  investments? Official data indicates that unemployment has fallen by 67% in the Albanian Alps and South Coast over the last five years, and between 2015 and 2019, tourist numbers doubled, from 500,000 to 1 million.

What’s more, now over 90% of people in these areas have access to clean potable water and safe sewage systems. Approximately 11,000 businesses and 365,000 inhabitants have benefitted from the many projects.

“The cooperation of ADF with CEB has been successful and has given tangible results in the development of Albania in several areas. 

The key focus of this cooperation is to promote local development and sustainable tourism by improving public infrastructure. The programs implemented so far have had a direct impact on improving the quality of life,” says Ermir Omari, Head of Project Management at ADF.

At-a-glance

  • Programme funding totalled €36.7 million
  • There were 21 sub-projects in 6 municipalities
  • The programme lasted 4 years  

Source: Albanian Development Fund

Ulza, AlbaniaLooking ahead  

“It’s extremely rewarding to see how the CEB loan has supported sustainable tourist development in Albania, with a focus on natural resources and cultural heritage. 

This sustainable development guarantees long-term tourism while preserving the environment, and enabling the economic and social development of the local communities,” says Maria Siguënza, Country Manager for Albania.  

These CEB-funded projects are just some of those set to enhance living conditions, tourism, environmental sustainability and public infrastructure in the Albanian Alps. A Master Plan for the Albanian Alps was completed in December 2017, paving the way for an investment of €160 million over the following 15 years.  

Some €55 million-worth of priority investments have already been identified, and designs have been prepared for selected sub-projects. The ADF is now exploring funding options to implement the plan, including potential contributions from the European Investment Bank, the European Bank for Reconstruction and Development and the World Bank. 

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