Gjergj Buxhuku, head of Konfindustria, has voiced concern about the state of the Albanian economy, criticizing the new fiscal package and the lack of a clear development plan. Speaking on News24’s “Minuta e Parë” program, where he appeared with journalist Ola Bruko, he said the outlook for 2027 was pessimistic. Among the main problems he cited were the economy’s dependence on informal money and criminal activity.
According to Buxhuku, the fiscal package has been treated as an arithmetic exercise rather than a plan setting the economy’s direction in the short, medium and long term. He pointed out that there is no data on the impact of each proposed measure.
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“The problem is that the package has been presented as arithmetic, not as a project showing where the Albanian economy is headed and what its short-, medium- or long-term objectives are. We have no data on the economic impact of each proposal. We all want the economy to do well, but the forecasts for 2027 are pessimistic. This is related to the economy’s real foundations and the ‘oxygen’ that sustains it. Even a perfect fiscal package produces negative results if the economy is distorted.
“The Albanian economy has several characteristics that expose it to the risk of collapse. First, there is informal money coming from abroad—in other words, dirty money. The damaged part of the economy has expanded so much that its share may be greater than that of the healthy, formal economy. The value of dirty money, with absolute certainty, exceeds 35-40 percent, while in the absence of official data, it is said to be even higher. Most of it is money obtained abroad, generated by crime and brought into Albania.
“Second, Albania does not have a free-market economy: monopolies and oligopolies have eliminated competition. In his view, this makes the economy resemble a centrally planned socialist state economy and a criminal market. It is a closed economy, with neither competition nor a level playing field.
“Third, the economy relies heavily on corruption, which takes the form of laws that appear to be properly applied but are violated, as well as state capture through laws drafted to order,” Buxhuku said.
He linked his pessimistic outlook for 2027 to the economy’s reliance on illicit money flows. In his view, these sources cannot continue financing the country indefinitely, since the states from which the money comes may intervene to stop the activities that generate and transfer illicit capital.
“Even without the fiscal package, dependence on dirty money makes the outlook for 2027 bleak. The country risks becoming a Caribbean pirate island, until the states from which the money comes say, ‘Stop.’ SPAK is targeting major criminal groups, and there are operations of this kind almost every month. The agency is expected to significantly increase its capacity to strike. The democratic world will not allow these activities to continue indefinitely. It knows about the flows being taken from it and knows exactly which businesses have been set up and are being kept afloat by them.
“As we can see, operations are increasing. SPAK is not an institution that acts at the discretion of political forces in Albania, but an extension of EU and US institutions working to combat trafficking. Every country that poses this level of risk has a SPAK. The crackdowns will intensify, and Albania will not be a safe place for these practices. The people are not sustained by the ‘oxygen’ of the formal economy; rather, the country is being kept afloat by dirty money, the flows of which have begun to decline. We hope SPAK’s operations do not bring down the economy,” he added.
The head of Konfindustria also raised the possibility that the government had anticipated the consequences of disrupting informal money flows and had drafted the fiscal package and next year’s budget to find alternative sources of funding. “This aspect of the issue may also have been taken into account. Perhaps that is why a fiscal package and a budget have been drawn up to provide a certain amount of ‘oxygen’ for next year, in case SPAK continues its operations and these revenues dry up,” he said.
Buxhuku also criticized the way fiscal costs are ultimately passed on to consumers. He argued that businesses may reflect additional expenses in the prices of goods and services in order to protect their profits. Since Albania is also an importing economy, he said, tax increases directly burden citizens.
“That is not how you determine who will bear the burden: in the end, the citizen pays. Businesses try to protect their profits by raising prices. This can continue up to a certain point, because Albania is not only a centrally planned economy but also an importing one. Every tax increase is passed on to the citizen. A business either goes bankrupt or raises its prices,” he said.
