Albania has launched an ambitious four-year Reform Agenda, to modernize the country and prepare for its future in the European Union. This plan is Albania’s roadmap to access significant EU funding through the Reform and Growth Facility. In simple terms, this plan is about making Albania more competitive, creating better opportunities for its people, and building a stronger, more transparent state.
The Reform Agenda is built on five key areas that all work together, like pillars holding up a building. Progress in one area strengthens all the others: (i) Business Environment and Private Sector Development; (ii) Human Capital; (iii) Digital Transformation; (iv) Energy and Green Transition; and (v) Rule of Law/Fundamentals.
How do these reforms help?
Competitiveness and Digitalization: The plan focuses on making Albanian businesses more productive and innovative. At the same time, digitalization isn’t just about tech upgrade; it’s about changing how the government and economy work to be faster and more efficient for everyone. Both of these depend on Good Governance – fair rules and transparent institutions that citizens can trust.
Connecting Reforms to Funding: The EU funding is a reward for achieving real, measurable progress in these areas. It’s not just for planning the reforms, but for successfully implementing them.
What’s Happening Right Now?
The first steps are already underway, with initial targets set for the end of 2024. Key actions include:
- Launching a new strategy and grant scheme to support entrepreneurs and startups.
- Improving the transparency and management of companies owned by the state.
While these early steps are important, the full effect of these changes will become clearer by the end of 2026, when the most significant reforms are expected to be in place.
Challenges on the Road Ahead
Implementing fast-paced reforms is a major challenge. The public administration, which is also managing the complex process of EU membership negotiations1, is under significant pressure. This can stretch human and financial resources thin.
The ambitious path set by the RA relies heavily on strengthening institutional capacity to effectively implement and monitor reforms. Although governance structures are in place, delays in real-time public monitoring hinder accountability. Enhancing transparency and building public trust are essential to ensure sustained progress and encourage stakeholder engagement in the reform process. In this context, clear and high-quality communication to the public about the progress of reforms can make a significant difference.
Although political commitment is assured, given that reforms are framed within an election cycle, the principal challenge remains balancing the short-term impact of reform actions with the pursuit of long-term structural changes. For example, efforts to develop the private sector must focus on increasing its dynamism in a context where integration into the EU Single Market poses significant challenges for Albanian businesses, including regulatory barriers to internationalization, intense competition, and the necessity to meet stringent market standards to survive and thrive.
Finally, the Reform and Growth Facility Regulation provides a general rule for assessing the fulfilment of payment conditions related to the quantitative and qualitative steps outlined in the Reform Agenda. However, the formal evaluation methodology and the specific criteria by which the EU Commission will determine whether a reported reform is considered “implemented” or “not implemented” remain unclear. For instance, will the Commission regard a reform as implemented merely upon the approval of a draft law (e.g., on Concessions and Public-Private Partnerships) or the formal establishment of an Asset Recovery Office? Or will it require additional evidence, including a more in-depth assessment of the quality of the legislation and the effective operational capacity of the institution in question?
While the above challenges are acknowledged, they are expected to be gradually addressed through a learning-by-doing approach as implementation progresses. It is natural for some uncertainties to arise in the initial phases of such a complex reform process. However, the most important thing is to maintain consistency and predictability – the “rules of the game” should not change halfway. Maintaining a stable and transparent evaluation framework is essential to preserve trust, support effective planning, and encourage sustained commitment from all stakeholders involved.
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1Albania’s goal is to open for negotiation all the EU clusters within 2025 and close them by the end of year 2027.
