Introduction to Albania and Kosovo This introduction provides some background information on Albania and Kosovo. Kosovo is a region of Serbia but the population is primarily composed of ethnic Albanians. Albanian is the dominant language of the region. Geography Albania The Republic of Albania is a Balkan country in Southeastern Europe. It borders Montenegro on the north, the Serbian province of Kosovo on the northeast, the Republic of Macedonia on the east, and Greece on the south. It has a coast on the Adriatic Sea to the west and a coast on the Ionian Sea to the southwest. Despite having a troubled history, the country has been classified as an emerging democracy since the 1990s. 1 Albania consists of mostly hilly and mountainous terrain, with the highest mountain, Korab in the district of Dibra, reaching up to 2,753 metres (9,032 ft). The country mostly has a continental climate with cold winters and hot summers. Besides the capital city of Tirana, which has 800,000 inhabitants, the principal cities are Durrës, Elbasan, Shkodër, Gjirokastër, Vlorë, Korçë and Kukës. Albania is divided into twelve counties (officially qark/qarku, but often prefekturë/prefektura), sometimes translated as prefecture). Each county is subdivided into several districts. Kosovo Kosovo is a province in southern Serbia which borders Albania and has been under United Nations administration since 1999. While Serbia's nominal sovereignty is recognized by the international community, in practice Serbian governance in the province is virtually non-existent. The province is governed by the United Nations Mission in Kosovo (UNMIK) and the local Provisional Institutions of Self-Government, with security provided by the NATO-led Kosovo Forces (KFOR). Kosovo borders Montenegro, Albania and the Republic of Macedonia. The province's capital and largest city is Priština. Kosovo has a population of around two million people, predominantly ethnic Albanians, with smaller populations of Serbs, Turks, Bosniaks and other ethnic groups. 2 Demographics Albania Albania is composed of a blend of religions and cultures. The majority of the population is comprised of ethnic Albanians who are mostly Muslims. Minorities include Greeks, Serbs, Macedonians, Bulgarians, Roma (Gypsies), Vlach, Bosniaks and Italians. The dominant language is Albanian, with two distinct dialects, Gheg and Tosk. Many Albanians are also fluent in English, Greek and Italian. Kosovo Kosovo's total population is estimated between 1.9 and 2.2 million with Albanians making up nearly 90 percent and Serbs at 7 percent of the ethnic population. Et'hem Bey Mosque at night Gjerovica/Đeravica is the highest peak of the Kosovo province's part of the Prokletije mountain range. As a part of the Ottoman Empire, Albania became a mostly Muslim territory. During the Communist era, religion was prohibited, and Albania was proclaimed as the only officially atheist country in the world, claiming its national "faith" to be Communist. Today, with the freedom of religion and worship, Albania contains numerous religions and denominations; however, religious affiliation is hard to determine as most people prefer to be identified as secular or non-religious. Statistics vary from different sources: around 70% are Muslim, with over 20% being Bektashi Shi'a Muslims; about 20% are said to be Orthodox Christian, and 10% Roman Catholic. Other main religions of the world also have some small representation in Albania. Religious fanaticism has never been a problem, with people from different religious groups living in peace. Intermarriage across religions is very common, and an immensely strong sense of Albanian identity has tended to bind Albanians of all religious practices together. 3 Economy Albania Albania remains one of the poorest countries in Europe. According to the Bank of Albania, per capita income was U.S. $2,550 in 2005. The official unemployment rate is 14%, and 18% of the population lives below the poverty line. Almost 60% of all workers are employed in the agricultural sector, although the construction and service industries have been expanding recently; the latter boosted significantly by ethnic Albanian tourists from throughout the Balkans. The GDP is comprised of agriculture (approx. 24%), industry (approx. 13%), service sector (approx. 39%), transport and communication (12%), construction (11%), and remittances from Albanian workers abroad--mostly in Greece and Italy (approx. 14%). Albania was the last of the central and eastern European countries to embark upon democratic and free market reforms. Since the fall of communism in 1990, Albania has launched economic programs towards a more open-market economy. The democratically elected government that assumed office in April 1992 launched an ambitious economic reform program to halt economic deterioration and put the country on the path toward a market economy. Key elements included price and exchange system liberalization, fiscal consolidation, monetary restraint, and a firm income policy. These were complemented by a comprehensive package of structural reforms, including privatization, enterprise, and financial sector reform, and creation of the legal framework for a market economy and private sector activity. Most prices were liberalized and are now approaching levels typical of the region. Most agriculture, state housing, and small industry were privatized, along with transportation, services, and small and medium-sized enterprises. After severe economic contraction following 1989, the economy slowly rebounded, finally surpassing its 1989 levels by the end of the 1990s. Since prices have also risen, however, economic hardship has continued for much of the population. In 1995, Albania began privatizing large state enterprises. Since 2000, Albania has experienced a more rapid expansion of its economy. In recent years the Albanian economy has improved, although infrastructure development and major reforms in areas such as tax collection, property laws, and banking are proceeding slowly. Between 2001 and 2005, Albania experienced an average 5.8% annual growth in GDP. Fiscal and monetary discipline has kept inflation relatively low, averaging roughly 2.5% per year between 2003 and 2005. Following the signing of the Stabilization and Association Agreement in June/July 2006, European Union ministers urged Albania to push ahead with reforms, focusing on press freedom, property rights, institution building, respect for ethnic minorities and observing international standards in municipal elections. Albania's trade imbalance is severe. In 2005, Albanian trade was U.S. $1.8 billion in imports, and U.S. $350 million in exports. Albania has concluded Free Trade Agreements (FTAs) with Macedonia, Croatia, UNMIK (Kosovo), Bulgaria, Romania, Bosnia, and 4 Moldova. In April 2006, these bilateral agreements were replaced by a multiregional agreement based on the CEFTA model. However, combined trade with all these countries constitutes a small percentage of Albania's trade, while trade with EU member states (notably Greece, Italy, and Turkey) accounts for nearly 68%. Business growth is further hampered by Albania's inadequate energy and transportation infrastructure. The capital, Tirana, generally receives electricity most of the day, but constant power outages plague every other major city, small town and rural village. Albania's coastline on the Ionian Sea, especially near the Greek tourist island of Corfu, is becoming increasingly popular with tourists due to its relatively unspoiled nature and its beaches. The tourism industry is growing rapidly. Kosovo Kosovo’s official currency is the Euro and is used by UNMIK and the government bodies. The Serbian Dinar is used in the Serbian populated parts. The economy is hindered by Kosovo's still-unresolved international status, which has made it difficult to attract investment and loans. The province's economic weakness has produced a thriving black economy in which smuggled petrol, cigarettes and cement are major commodities. The prevalence of official corruption and the pervasive influence of organized crime gangs have caused serious concern internationally. The United Nations has made the fight against corruption and organized crime a high priority, pledging a "zero tolerance" approach. Transportation Albania Although recent steps have been taken to improve the transportation infrastructure, Albania has a limited railway system and just one domestic airport. Because of the mountainous terrain, goods traveling overland must spend hours traversing the relatively sparse network of switchback roads, many of them of poor quality, to reach destinations that are relatively close. In the early 1990s, the rock-strewn roadways, unstable rail lines, and obsolete telephone network crisscrossing Albania represented the remnants of the marked improvements that were made after World War II. For years, peasants needed special passes to visit nearby districts, and until 1990 the government banned private ownership of automobiles. Urban mass transit consisted primarily of bus lines for ferrying workers between home and work. In the last decade, many of the country roads were either being repaired or have been repaired. The construction of the north-south and east-west are almost completed. By 2007 the main cities will have been linked and a new highway system linking Tirana with Priština, Podgorica, Skopje and Athens will have been completed. In 2004 a deal 5 was signed to connect the port of Durres with City of Priština in Kosovo with a six lane