Speech of Prime Minister Edi Rama at the meeting of the National Economic Council:

Hello to everyone!

The building where we have gathered is an added value of great importance for Tirana, in every respect, both in terms of architecture and urban planning. It is no accident that this building became part of the international publications on architecture and urban planning before it opened, but it is no less important form the economic and social point of view because it enhances the quality of city services and diversifies the options for a space like this one, creating excellent conditions, as far as I can see, for having conferences or meetings.

My very sincere congratulations also on another not insignificant fact. This is one of the few, if not the only building built in Tirana after 1990, that has met faithfully the conditions prescribed in the implementation project and the construction permit.

Obviously, it is very clear to me that this is not a happy day for everyone, and that my word will be used as an alibi in the “crime scene”, for this is one of the “crimes” that I’ve committed as a mayor, a urban, architectural and economic “crime”. Undoubtedly, it is also a total “abuse” of the position, because in fact the building is “mine”, not theirs.

But these words will be gone with the wind, as it has happened many other times. What remains though, is the extraordinary work of these investors and entrepreneurs, a work that will belong with the city forever, as one of the most important icons of the ambition to build a European Tirana, a European Albania.

I don’t expect them to offer us a coffee after all these compliments, knowing the composition of the group and the presence in this group of a dear Greek friend, who is nationally and internationally renowned to be as rich as he is renowned to be “stingy”. They don’t offer you a coffee, let alone something more.

Jokes aside, it is important that the values are here and they remain here.

It was the most important minister of our government who chose to organize here this session of the National Economic Council, because not only we feel compelled, and I personally feel compelled, to promote everything good is happening in the world of entrepreneurship, but also because we want to promote a very important step on the path to facilitate entrepreneurship by facilitating procedures, increasing the effectiveness of cooperation and interaction between entrepreneurship and administration, and established a new, broader and more solid base for the coming economic and financial year.

I want to thank especially the Governor of the Bank of Albania for his presence in this session. Not because this is the first time that the Governor attends this meeting – in fact, the presence of the Governor is a tradition of the National Economic Council – but because he has played a key role in this process. The professionalism and commitment of the Governor to advance with concrete actions, but also with an admirable job of public relations, a process where we need much more investment and lending, is a contribution of great importance, which our government and I personally appreciate a lot.

I want to mention what Bank of Albania has highlighted competently: the change of the economic structure. This change has been our major goal since the first day we took office, with the conviction that the economic model on which the growth of the years preceding the financial crisis was built, and also later when we took the reins of the government, in a period when the crisis wasn’t yet over, was a model that had been exhausted.

The two main sources of economic growth, and the two main pillars on which this model was built, construction and remittances, cannot be considered anymore as sustainable sources suitable for trying to develop Albania economically. Therefore, we identified the need to move towards an economic model based on exports and productive investments, and which takes into consideration sustainable sources of growth that Albania has, ranging from oil and underground resources, to energy, agriculture, tourism and manufacturing.

This new economic model cannot be easily built. We could not start building it without implementing some fundamental reforms, such as the priority reform in energy, the territorial and administrative reform, the pension reform, reform of the tax system, the reform of the welfare and the social assistance scheme. Last by not least, by reforming the whole operating mechanism, in relation to the territory where economy is developed, through the fight against informality.

All of these reforms, which have moved forward successfully, although none of them can be considered concluded, for they cannot be completed in a period of 32 months, will not have a full impact without the reform of the reforms, which is the Judiciary Reform.

I’m grateful because business organizations and the Governor have raised their voices, and obviously their voices have been of great importance outside the boundaries of the arena of political struggle, to share with the Albanians a simple truth, but not easily readable at first glance, that we don’t need justice to be just only in terms of the direct issues that people, institutions or enterprises have with courts, but we need justice to be just so that it can be an unmovable background throughout the path to normal development of the economy under the law.

Even the International Monetary Fund has determined the Reform in the Judiciary System as a reform that can improve the business climate in Albania to 35%, and thus affect economic growth in terms of acceleration.

I’ve heard with great attention and respect, although I have not always approved of, the reactions of business or of some foreign chambers of commerce who have highlighted a significant issue in the doing business climate. Undoubtedly, there is a big truth in these reactions, and this is that what we have done is absolutely not enough if we do not complete what must be done.

Let me say that there also is another truth. Business are not very much used to respect the law, just as enterprises, even the largest and the most important of them, are not very much used to act within the law framework in every step they take and in every detail. Informality is not the work of a few, but it is the work of everybody together. It is the work of the governments who did not reform the administration, especially the fiscal one, who did not reform justice, but it is also the work of the actors in the market who have benefited as much as possible from the opportunities provided by a space where laws have remained on paper in most of the cases.

Only in a country like this can happen that a foreign company says it doesn’t have the means to pay taxes, and you cannot impose the payment of taxes because otherwise that company will debunk you internationally.

Only in this country and only in this atmosphere, a foreign company can threaten the Albanian government, a sovereign government, by waving the American flag or other highly respected flags. Of course, we did not give them any room, but we have taken into account the consequences of the threat.

It’s easy to use the stereotypes created, and in this case the stereotype of Albania as a corrupt country, so that they can act as innocent, make the victim and the be party hit by the government of this country. It is very easy to convince ambassadors that the government is to blame. I brought an example, but this is not the only example, unfortunately.

I made it very clear to all companies and to all representations in Albania, that for every problem that businesses have with the administration, my door is open, the door of the Minister of Economy or of the Minister of Finance is of course open. I have heard many bizarre things that would make “Kurban 2” much more commercial, if I were to write it.

But to continue with the part that has truth inside, there is room for further very important improvements in terms of the business climate in Albania; there is room for further very important improvements in terms of the functioning of tax and customs administration in Albania; there is room for further very important improvements in terms of the very functioning of our government in relation to business.

With the same sincerity and honesty with which I am ready to face anyone, when I point at those who act like angels, while in fact they hold the position of the devil in certain cases, with the same sincerity and honesty I admit that what we have done is not enough and cannot be enough. Had it been enough, we wouldn’t have been here, either me or the minister of Finance, and the former minister of Economy, but we would have claimed to take on global roles to solve global problems like magicians.

The context must be never forgotten.

I understand very well the reaction of the business, but to say that the business climate today is worse, whereas 32 months ago you could not even get VAT back without paying at least 50% of what belonged to you, this seems a bit excessive.

You say that the business climate has grown worse, whereas 32 months ago you couldn’t dare to say a word when you used your money to pave kilometres of roads, and you were in big trouble with the banks where you submitted as a guarantee the contract you had entered with the government, and all of you on the verge of bankruptcy in terms of unpaid public works. Precisely because this government wants to build a new relationship with business, and wants a whole new context for the relations it has with itself as the government of the Republic of Albania, it paid you every penny. This is a bit difficult to overcome.

Saying that the tax administration is such a problem that it can be read as a worsening of the business climate, when you know very well what went through in terms of tax administration 32 months ago, – anytime you had to take money out of the coffers of your company, out of the pocket of your family, to make plans in terms of income, at least, or anytime you had to take the money out of that 10% to conclude works, or anytime you had to deal with every sort of controllers who would act like gangsters and treat you not as entrepreneurs, but as if you were servants held hostage. This is a bit exaggerated.

What I see necessary and which is not at all excessive, is your request and my request since the first day, for the government and the ministers associated with economy and entrepreneurship to simplify procedures, to facilitate and simplify the fiscal package, to build a framework that is simple, possibly the simplest that can be found in the region and Europe.

If the report of the International Monetary Fund shows that fiscal easing in Ireland produced a 4% increase in 10 years, a 3% increase in Poland, or even a 1% increase in Germany, the land of earthly perfection, as much as perfect earth can be, I am very confident that relief and simplification will bring us a very important added value also in terms of economic growth.

I’m not listing what we have done to take you out of the financial pit where we found you. I will simply mention the challenges. We want to revise the legislation and tax procedures, in order to reduce bureaucracy to the possible maximum extent, which we will identify together.

Some time ago, the Minister of Finance submitted to all of you here, entrepreneurs, and also to all those who do business in Albania, a concrete request, with a concrete form, to make concrete proposals for this purpose.

In addition, we want to go forward with a further liberalization of the market, with the standardization of the tourism sector, but not with a standardization to increase bureaucracy, but a standardization to simplify at maximum the path of everyone investing in tourism, or who has made an investment in tourism.

We want to reduce all possible non-tariff barriers for business. We want to increase institutional capacity and facilitate trade at maximum through a new structure of cross-agency cooperation.

First, it has been a while since we have started, and we are working intensively on a new model to address complains of every investor. What we aimed at and hoped since the beginning – which was to have the Secretariat of the National Economic Council as a reference point for all those who have complains – did not work. The culture created over the years has been against us, and everybody would rather use other means than submit concrete complains to the Secretariat and leave the decision-making with this Council, provided that the Secretariat cannot find a solution, even though it is chaired by a renowned lawyer of this country, and has a structure and the means to address complains and make legal suggestions to the ministries or to the Prime Minister very rapidly. We are working on this new model together with the World Bank, by looking at other models but also by going beyond these similar models.

Second, we are working together with the European Bank for Reconstruction and Development to set up the institution of the Business Advocate. Its institutional and legal power will be such that it will defend any business before the business decides to go to court and to a process where the “trial” will take place between the business and the institution or the relevant institutions, about which the business complains, with the presence of the Business Advocate.

Third, we are engaged in a new very important program, with the support of USAID and with a team of the City Hall of New York, which is highly specialized in terms of taxes, in order to increase the professional capacity of the tax administration in all directions.

Fourth, the qualification of the workforce. I am grateful to Luan Bregasi, whom I want to mention here separately, although I will be accused of favouritism, but the fact is that he has favoured enormously by coordinating a historical effort of this government, but also for the business to enhance the quality of the workforce through vocational education, which is a priority for us. The reform of Vocational Education is based on a concrete cooperation with business.

Today, in the school boards of vocational education there are not militants anymore, but businessmen, while the chairmen of the boards of these schools are entrepreneurs. This has brought a big change, along with the fact that undertakings associated with the school since the first day of school book their future employees who spend part of the week at school and the rest in the enterprise.

At the Vocational Education fair, it was amazing to see that the greatest percentage of students who attended the fair were all employed, in the sense that in addition to attending school, they were also trained in the enterprise in order to obtain the skills to do their job in the same business, and work their way up.

On the other hand, we want to further encourage exports, and facilitate trade and interaction. Albania has taken the initiative to propose to the next meeting of prime ministers of the Balkans, a joint project to remove all non-tariff barriers and to create a free trade zone in terms of the European Union. Countries of the region must behave with each other just as EU countries behave with each other, in terms of non-tariff barriers, to go beyond CEFTA.

We have received assistance from the World Bank offices across the region, who have provided us their great expertise. It was our project, and the World Bank helped us.

In Paris, we will have the package ready, which has been already approved by most of the prime ministers, not because there is any problem with any prime minister, but because you know that not all Balkan countries have a calm political situation at the moment.

What we did with Kosovo has shown us how much potential there is for business, merely by facilitating trade routes and commercial interaction. We will take it further.

The formalization of farmers and VAT credit through self-invoicing, the subsidization of products collectors, the financed special programs have produced results, but we want to go further.

My friends,

We have 300 million Euros available for the next three years from the innovative program for agriculture of the Albanian government, in cooperation with the EBRD and commercial banks. We have created a state guarantee fund, we have found a complete understanding of the majority of commercial banks, and we have the support of the EBRD.

Our wish is that those who have the money, will not keep them in the banks, and those who so far have dealt with construction or activities unrelated to agriculture, will deal with agriculture. There are here some examples of those who have begun to do so. 300 million Euros in three years for loans with favourable interest guaranteed by the Albanian state.

It is important that you who are here and those who are successful entrepreneurs, who are already structured, have institutions supporting them; they are not just owners who have named their enterprise by putting together their family names, but they are serious structures, they can diversify their portfolio by taking advantage of this exceptional opportunity that would bring a big boom in exports and a considerable economic growth in the coming years.

I want to emphasize once again that this government can be blamed for everything, but the last thing that can be blamed for is the approach to business. We are the most pro-business government that the Republic of Albania has ever had. Just open the manuals written by those who call themselves real left-wing, to understand this.

On the other hand, our government is the most interested in removing from your path every obstacle created by bureaucracy, corruption and the old culture in a sinful relation with business. But we cannot do this alone. It cannot be that between us and you, the boss is whoever has any political or administrative authority. This should not happen!

You have to invest a lot more confidence, and must start from the examples of those who solve the problem when they raise it. Preferring to address the problem with a tax collector, despite being a big company, and not taking the tax collector where it belongs, in cooperation with the government, is unacceptable in all respects. It is a shame!

Preferring to go round in circles to find a way out of ‘x’ or ‘y’, and not addressing via these channels we have created, also via this National Council, a problem of principle related to your business, this truly means accepting an agony in relation to an operation that won’t hurt you, but will hurt who is in charge and has hindered you on behalf of the state, the administration or whoever.

And this is not propaganda. This is the culture of this century and of this continent where a great European family lives, and which we want to make ours by becoming members with equal rights.

Many thanks!​