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Exports have no power to recover, businesses suspend investments

Politiko 2025-06-17 17:10:36

Exports have no power to recover, businesses suspend investments

Exports of Albanian companies to the world remained stagnant, while now the economy is showing another problem; that of decreasing imports.

The Institute of Statistics reported that for the first five months of the year, Albania exported around 168 billion lek of goods to international markets, with an increase of less than 2.1 percent compared to the same period last year.

Apart from a negligible increase, it comes from a low base. This is because last year marked the lowest level of exports since the pandemic. According to INSTAT data, in 2024 total exports of goods from Albania amounted to 373 billion lek, or 114 billion lek less than in 2022.

Albania's exports to international markets were hit hard by the exchange rate, but also by rising costs for domestic producers, falling for two consecutive years from 2023 to 2024. After this sharp decline, exports seem to have stabilized in the depths of the crisis, with no power to recover again.

But beyond the dramatic decline in exports, the Albanian economy is now facing a new problem. This is the decline in imports, especially in the products most critical for economic development.

Official data from INSTAT show that for the first five months of the year, total imports decreased by almost 10 billion lek or 100 million euros, and the entire decline came from imports of machinery and equipment.

So, Albanian businesses are buying less machinery, equipment and technology from abroad, products that are directly linked to the performance of investments in the national economy. It remains to be seen whether this decline in machinery imports is related to the election period, during which businesses generally remain passive and postpone investment plans.

 

However, beyond investments, the performance of imports this year in other product items also signals a worrying trend. That of a slowdown in consumption or its stagnation, in conditions where the reduction in imports has not been accompanied by domestic production, which in entire segments of the economy such as agriculture and industry continues to shrink at a significant pace./ Kapitali.al

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