Albania 1 Euro: A failed policy, or a missed opportunity?

The “Albania 1 Euro” initiative was introduced as a policy aimed at encouraging private investment by leasing public assets for just 1 euro. The main goal was to attract foreign and domestic investors, create jobs, and develop specific sectors of the economy. However, after more than a decade, the results of this policy have been questionable and, in many cases, disappointing. Critics argue that this scheme facilitated the misuse of public assets, opened space for clientelism, and failed to fulfill its economic objectives.

Similar policies have been applied in other countries, such as Germany with its “abandoned cities” program or Italy with the 1-euro home scheme. Unlike these models, which aim to stimulate regional development and revive local economies, “Albania 1 Euro” focused primarily on industrial and service investments. The main difference is that in other countries, these policies were accompanied by additional support measures such as grants, infrastructure improvements, and fiscal incentives—elements that were lacking in Albania.

In the case of Germany and Italy, these policies had a positive effect on small communities, encouraging the development of neglected areas. In Albania, by contrast, a considerable portion of assets allocated under this scheme remained unused or were exploited for speculative purposes.

Main failures of the policy

Lack of transparency and favoritism toward clientelism
One of the main problems of this policy was the method used to select beneficiaries. Public properties were often granted without genuine competition, favoring companies with strong political ties. The lack of clear criteria created fertile ground for abuse, where many contracts were not followed by actual investments. This resulted in an ineffective distribution of public assets and a lack of clarity about the economic impact of these projects.

According to data from the State Supreme Audit Institution (KLSH), in some cases, beneficiaries did not carry out the promised investments but kept the public properties as assets to obtain financing or later sell them at a profit. This phenomenon created a speculative market where state property was used as a financial instrument without bringing any concrete benefit to the economy.

Limited economic impact
Despite being presented as a stimulus for industry and new businesses, the majority of beneficiaries failed to create sustainable jobs or increase industrial production. According to a report by the Ministry of Finance, only 30% of the companies that received properties under this scheme met their obligations for investment and employment. This means that the majority of entities did not achieve the goals for which they had applied.

A concrete example is an industrial area in Fier, planned to employ over 500 people, which remained unused after investors failed to meet the conditions of the contract. This situation is not an isolated case but a recurring pattern in several similar projects across the country.

Mismanagement of public land and financial loss for the state
Instead of creating added value, the policy resulted in poor management of public assets. In many cases, state property was leased for 1 euro to businesses that never used the asset, blocking other, more productive developments. This mismanagement caused a financial loss for the state, estimated in the millions of euros.

A large portion of the assets given through this scheme remained unused or were used for purposes different from those defined in the contract. This phenomenon caused a significant loss of potential income for the state, as these properties could have been used more productively through alternative development policies.

What should have been done differently?

To ensure the success of this policy, it was necessary for it to be grounded in strong principles of transparency and effective oversight. To avoid the failures and challenges faced during its implementation, several key measures should have been taken:

• Clear criteria and strict oversight.
  The process of allocating public properties should have been fully transparent, based on clear and verifiable criteria, while responsible institutions should have ensured regular monitoring of the implementation of investment conditions.
• Prevention of abuse and speculation.
  Strong control mechanisms and a more active role for auditing institutions would have been necessary to prevent misuse and to stop unjust enrichment from this scheme.
• Structured support for serious investors.
  Beyond offering property for 1 euro, a support package should have been provided, including appropriate infrastructure and fiscal incentives for projects with real development potential, ensuring that only investors with genuine capacity benefited from this policy.

The “Albania 1 Euro” initiative had the potential to stimulate investment and economic development but failed due to a lack of transparency, oversight, and good management. Instead of supporting serious enterprises, it created room for favoritism and speculation, damaging the long-term administration of public assets and setting a dangerous precedent for future investment policies in Albania.