Albania has lost 40% of its population to emigration, which will reduce the economy by 0.4 percentage points per year.

Albania and Kosovo are the two countries that have experienced the highest population emigration in the post-communist space since 1990, according to the European Bank for Reconstruction and Development (EBRD) Transition 2025–26 report: “An old world, but braver”.

The report's graph clearly shows that Albania has lost about 40 percent of its 1990 population for the period 1990-2023, through net emigration alone, the second highest level in Europe and in the entire EBRD group of economies.

On the other hand, natural increase has been positive for most of the period and has compensated for about 27 percent of the 1990 population, which partially mitigates the shock, but not enough to neutralize the outflows.

Kosovo also lost 50% of its 1990 population over the same period, the highest level in Europe, although it had a lower natural increase than Albania at almost 40%.

The report says that this large demographic gap is translating into a significant economic drag on Albania. In the second chart of the report, the EBRD measures for the first time the annual impact of demographics on GDP growth per capita.

For Albania, the population contribution has been negative during 2000–2023, with about –0.2 percentage points of growth lost each year.

For the period 2024–2050, the impact is expected to deepen to –0.3 to –0.4 percentage points per year, making Albania one of the most exposed economies in the entire EBRD region. Even over the horizon 2050–2100, the signal remains negative, indicating that population aging and a shrinking labor force will continue to accompany the economy in the coming decades.

Labor shortages, the growing number of elderly people, and the weakening contributor base in social schemes are putting the economy under constant pressure.

The EBRD warns that without productivity gains, technological investments and policies that curb human capital loss, countries experiencing mass emigration, with Albania and Kosovo ranking first, will see a decline in their long-term growth potential.

The report adds that this model already has visible consequences on the labor market, investment, productivity and fiscal stability.

According to the EBRD, Albania and Kosovo are among the most exposed economies in the entire region. Even if economic growth remains positive, its potential pace will be significantly lower than in countries with growing populations, such as Turkey, Egypt or the countries of Central Asia.

The report suggests that in the absence of productivity growth, technological investment, human capital growth, and an improvement in the business climate, mass emigration will continue to hold back economic growth for at least another three decades. /Monitor