REPUBLIKA E SHQIPËRISË KËSHILLI I MINISTRAVE Strategjia Kombëtare për Zhvillim dhe Integrim 2007-2013 REPUBLIC OF ALBANIA COUNCIL OF MINISTERS National Strategy for Development and Integration 2007-2013 REPUBLIC OF ALBANIA COUNCIL OF MINISTERS National Strategy for Development and Integration 2007-2013 March 2008 Preface I have the pleasure and the honour to present the National Strategy for Development and Integration (NSDI) 2007-2013 which combines the principal agendas of the Government of Albania. For the first time the perspectives for sustainable economic and social development, integration into the European Union and NATO structures, as well as achievement of Millennium Challenges Goals are harmonised in a single strategic document. The NSDI crystallises the medium- to long-term vision of the development of the country based on an open and transparent process, which guarantees the broad inclusion of the civil society, local government, the business community, the academic and scientific world, the Albanian political spectrum and other groups of interest. The NSDI has also been consulted at length and with particular attention with our international partners who support Albania in its reforms towards development and integration and the achievement of the Millennium Development Goals. These objectives will be realised through cooperation with the entire political and social spectrum. In the course of these seven years, we will strengthen our democratic institutions and we will ensure that the rule of law is respected. The market mechanisms in place will allow businesses to better utilise the new opportunities. The rapid improvement of the country’s infrastructure will be our key priority. Social justice will serve as a basis for reforms so that the entire population benefits from sustainable economic growth. Considering this document as a major output of a large number of institutions, I would like to express appreciation for the particular dedication and work of the Department of Strategy and Donor Coordination at the Council of Ministers, as well as of all the line ministries and other public institutions that took part in this process. I would also like to express my appreciation for all the donors who supported us, and in particular the United Kingdom Department for International Development for technical and financial assistance provided for the preparation of this document. I would like to invite everybody to take part in the realisation of these joint goals in the service of further progress of Albania and the increase of the welfare of the citizens of our country. National Strategy for Development and Integration 4 National Strategy for Development and Integration Contents Introduction.............................................................................................7 1. Latest developments...........................................................................9 2. Vision, strategic priorities and goals ...................................................... 14 3. Policies ......................................................................................... 20 3.1 European Union and NATO integration .......................................................... 21 3.2 Democratisation and rule of law.................................................................. 26 Justice and home affairs......................................................................................27 Modernisation of administration.............................................................................38 3.3 Economic and social development ............................................................... 42 Infrastructure...................................................................................................42 Market economy................................................................................................54 Social policy.....................................................................................................60 Urban, rural and regional development ....................................................................76 4. Macroeconomic and fiscal perspectives .................................................. 86 5. Accountability................................................................................. 94 5.1 Consultation.......................................................................................... 94 5.2 Implementation ..................................................................................... 95 5.3 Monitoring ............................................................................................ 96 5 National Strategy for Development and Integration 6 National Strategy for Development and Integration Introduction In November 2005, the Government of Albania adopted the Integrated Planning System (IPS), a set of operating principles to ensure that government policy planning and implementation take place in a coherent, efficient and integrated manner. Two processes are the cornerstones of the IPS: A medium- to long-term strategic planning process, the National Strategy for Development and Integration (NSDI) (2007-2013), which establishes national strategic priorities and goals. A medium-term budgeting process, the Medium-Term Budget Programme (MTBP), which requires each ministry to develop between March and June a three-year plan within a specified expenditure ceiling to achieve policy objectives as intermediate steps to the achievement of the NSDI goals. The ceilings for the first year are allocated in further detail during the annual budget process, which takes place between July and October. The National Strategy for Development and Integration and the Medium-Term Budget Programme accommodate fully the following parallel planning processes: The Government Programme which was presented to Parliament in September 2005, in agreement with the constitutional obligation. Integration into the European Union, in particular the implementation of the Stabilisation and Association Agreement (SAA), and integration into NATO, through the achievement of membership standards, in five fields: political, economic, legal, military, financial and information security. Public investment management, which – under a new set of procedures implemented for the first time in 2007 – will become an integral part of the MTBP. External assistance, in particular the government efforts to optimise the use of foreign aid in agreement with the commitments of the Paris Declaration on aid effectiveness, which was signed in March 2005. In March 2006, the Strategic Planning Committee, the highest decision-making body in the IPS, took the following decisions on the NSDI: It will embody all the objectives and measures included in the SAA and the NATO Membership Action Plan and will aim to fulfil the standards and criteria of these agreements. The demands of these agreements are fully reflected in the national vision, the processes of design and implementation of the sector and crosscutting strategies and in budget planning. It will offer a medium-term time horizon for policy planning as well as a long-term vision for national development. It will define high-level indicators to gauge progress in achieving national goals. It will synthesise medium- to long-term sector and crosscutting strategies and reflect their indicative costing. Public investment management and the document for the orientation of external assistance will be based on sector priorities. The National Strategy for Development and Integration is succeeding the National Strategy for Socio- Economic Development (NSSED), which until 2006 was the main government strategic document. The changes that are being introduced with the NSDI aim to address some limitations of the NSSED process: The NSSED had been based on a limited number of sector documents that were developed ad hoc and not as part of a regular planning process in the respective ministries. The European integration and NATO membership goals were not fully taken into consideration. The NSSED process was both disconnected from and overlapping with the MTBP process. By contrast: 7 National Strategy for Development and Integration o Sector strategies will be the reference documents of the MTBP. In fact, the preparation and updating of sector strategies is the central feature of the NSDI process. o The NSDI will not be based on a three-year rolling framework, as this is the purview of the MTBP. Instead it will be medium- to long-term document with a planning horizon covering the period 2007-2013, which coincides with the financial framework of the European Union and of the Instrument for Pre-accession Assistance in particular. It will inform the MTBP process by providing a long-term direction for the allocation of resource across sectors. In June 2006, the NSDI preparation instruction was issued which defined: the sector strategies to be developed as foundations of the NSDI the standards according to which they would be reviewed the crosscutting strategies to be developed in order to coordinate some key policy priorities that were not the responsibility of a single ministry Line ministries began the preparation of sector and crosscutting strategies under the guidance of their respective Strategy, Budget and Integration Working Groups in June 2006. Draft strategies were submitted in mid-October 2006 to the Council of Ministers. The Department of Strategy and Donor Coordination at the Council of Ministers coordinated the preparation of the NSDI on the