Albania Essay Research Paper IntroductionToday Albania is

  • Просмотров 336
  • Скачиваний 13
  • Размер файла 16
    Кб

Albania Essay, Research Paper Introduction Today, Albania is a real mess. What is currently occurring in the region complicates the situation even further. I’m not sure what Albania should do for the next ten days, let alone ten years. But, I will try to discuss economics and resources. Second, past and current military and diplomatic policy. Finally, I want to tie all of this to the idea of adopting the policies and philosophies of the Western democracies. Only through the aid, encouragement and protection of the West, can Albania hope to make progress for itself and it’s citizens. Economics Albania is the poorest country in Europe. Years of dependence on the Soviet Union and China, followed by virtually complete isolation led to economic collapse in 1991 (Colliers

Encyclopedia CD-Rom, 1998). Government control of all areas of the economy resulted in manufacturing plants that lacked the freedom to adapt to changes. The lack of competition also created a lack of innovation. Collective agriculture produced less and less from harvests (European Forum, June 1997). In 1992, the Albanian government realized drastic change was necessary; Albania made very rapid progress in stabilizing the economy following the substantial political and social changes that accompanied the demise of Communism and the shift to a market economy in the period between 1990 and 1992. During that period, overall GDP fell by 41%, industrial pro- duction fell by 74%, and inflation rose to 237% in 1992. By 1993, output had started to rise, inflation reduced to 31%, and the

currency had been stabilized, as a result of tight fiscal policies (Poole p.2). In the early 1990’s Albania’s government abandoned most of its communist policies relating to the economy. In essence, leadership decided it could no longer deal with the problems, so why not lets its people try. A new privatization plan was enacted. “Within several months about 30,000 people found themselves employed by the non-agricultural private sector.” The government privatized 25,000 retail businesses in the first year through direct sales to workers (Colliers). The government has also relinquished title to much of the country’s farmland. Eighty percent of farmland was in private hands as of 1995 (European Forum). Larger firms have been harder to privatize due to a lack of capital in

the private sector. However, the government did introduce reforms in the larger manufacturing plants, allowing for managers to set wages, prices, and allowance of employee incentives through bonuses (Colliers). As of 1995, the few manufacturing firms that were not privatized were not economically viable and were in the process of being closed, although this may take a long time for fear of creating unemployment problems (Poole p.3). All of these moves and others has resulted in many economic gains for Albania. Inflation dropped to 5% in 1995. “The drop in production levels of 40% in 1991-1992 have been reversed into growth (over 10% per year since 1993).” Industrial production grew for the first time in several years, real wages are up, and foreign investment is increasing

(Poole p.4-6). Resources “With its significant petroleum and natural gas reserves, coal deposits, and hydroelectric power capacity, Albania has the potential to produce enough energy for domestic consumption while also exporting fuels and electric power” (Colliers). Under the communist system, these potentials were rarely realized. Known petroleum reserves are 200 million tons. During the 1970’s, Albania produced between 1.5 and 2.1 million tons. By the late ’80s it had dropped to 1.2 (Colliers). Albania is blessed to have many rivers with strong currents. The country has numerous hydroelectric plants. In normal times, water provides 80% of the country’s electric needs. During a two year drought in the late ’80s, there was not enough water to keep the turbines