Albanian Times, April 9, 1996

From: Albanian Times <[email protected]>

The Albanian Times (by AlbAmerica TRade & Consulting International) Directory

CONTENTS

[1] Albania Gets First Foreign Bank Subsidiary

"About $1.5 to $2 million are traded on this street every day," black marketeer Astrit Guri, 38, told Reuters. "This bank will be competition because it will absorb all the drachmas." Guri, a Sigurimi secret police agent until democracy made him unemployed, said authorities turned a blind eye to the booming street business. "We give a better price than the banks, about three to five lek more on the dollar," Guri said. "Everybody comes here."

The government said recently it was granting a permit to the National Bank of Greece to open the first completely foreign bank in this country of 3.3 million that emerged from 50 years of Stalinist isolation in 1990. "With a thin market like ours, we need foreign banks to create competition and improve the banking environment," said Valer Miho, head of the international department of the Savings Bank of Albania, the biggest of three state banks. "It will be useful to have a real market player to watch and learn from. I'd like to see more foreign banks here."

Albania invented its banking system in 1992, setting up a central bank and three supervised state banks, but people remained mistrustful of dealing with the state. One of them, the National Commercial, has set up two joint banks with foreigners: The Arab Albanian Islamic Bank with a group of Saudi banks and the Italian Albanian Bank. The Dardania Bank, only technically the first completely foreign bank in Tirana, is owned by Kosovo authorities and is not seen as a fully-fledged commercial bank.

"I don't trust any of these Albanian banks with my money but I would keep it with National if it opens," said Alfred Zisi, a 34-year-old cafe owner who set up his business with savings from five years of immigrant labour in Greece. Located next to the "Christ" restaurant and the "John Belushi" cafe, his cafe typifies the entrepreneurial spirit that has swept the country.

Rows of makeshift shacks selling anything from bicycles to soap have sprouted along the streets of the bustling capital. Even the ugly concrete bunkers dotting the green countryside have been copied into miniature marble ashtrays for tourists to take home as souvenirs.

This capitalist boom hinges mostly on cash from Albanians working abroad to support families back home. They made up to half of Albania's $3 billion GDP in 1994. Most of their money moves outside the embryonic banking network, which has yet to set up a clearing system between banks, enjoys only one computerised dealing room and has issued a total of 40 credit cards to Albanian citizens.

"Money is moved in cash outside banks, which is very dangerous for our staff carrying it," said Greek businessman Ilias Katsouris, whose joint-venture company distributes Greek-made Lowenbrau beer in Albania. "It's a very primitive system and it often takes weeks to do simple transactions," he added. "They will have no choice but to improve to cope with competition from the National Bank." National Bank officials said their subsidiary is expected to open by June in Tirana's newly-built business centre and to focus on retail banking, foreign remittances and imports. The Albanian authorities say it will have a base capital of two hundred million leks ($2 million) and a full retail banking licence.

"Our purpose here is to help develop Albania's foreign trade, attract foreign investors, mainly Greeks, and contribute to the development of Albania's banking system," said Apostolos Sotiropoulos, head of Balkan Branches at the National. He said the branch will allow Albanians to use National's international network of 70 banking units in 13 countries. But mostly it will help Greeks, the second biggest investors after the Italians, who own about 100 joint ventures worth more that $50 million in this mainly agricultural country.

"Welcome!" shouted Greek businessman Efthimios Evagelatos, raising his arms in the air. "I've been here five years and I find it hard to believe a Greek bank will actually open." One of the first Greeks to venture to Albania five years ago, his Luxury Ltd firm now owns four home appliance shops. National's opening signals a new era in Greek-Albanian relations, mended recently after years of tension over ethnic Greeks in Albania and about 300,000 illegal Albanians in Greece.

"Albania has agreed to soon examine four more applications from Greek banks to open in Tirana," Greek Finance Minister Alecos Papadopoulos told Reuters. The banks are the state Ionian Bank, the Commercial Bank of Greece, the Bank of Piraeus and the private Alpha Credit Bank.

(Courtesy of Reuters)

[2] Yugoslavia and Macedonia Sign Normalisation Treaty

[3] World Bank Credits to Albania Totalling $204 Million

* 1992 Critical imports -- $41.1 m
* 1993 Alleviation of rural poverty -- $2.4 m
* 1993 Technical assistance -- $4 m
* 1993 Transportation -- $18 m
* 1993 Improvement of agricultural sector -- $20 m
* 1994 Housing -- $15 m
* 1994 Social security network -- $5.5 m
* 1994 Development of labour market -- $5.4 m
* 1994 Water system of Durres -- $11.6 m
* 1994 School rehabilitation -- $9.6 m
* 1995 Credits for enterprises -- $15 m
* 1995 Rehabilitation of water system -- $10 m
* 1995 Rehabilitation of health system -- $12.4 m
* 1995 Reducing losses in electric network -- $5 m
* 1995 Rural roads -- $15 m
* 1996 Urban works and micro enterprises -- $4 m

[4] E-U to Rehabilitate Schools in 6 Albanian Districts

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