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Australia first established diplomatic relations with Albania in 1985 when the isolationist communist regime established by Enver Hoxa following WWII was still in power. Non-resident accreditation to Albania is held by the Australian Ambassador in Athens while the Albanian Ambassador to China, resident in Beijing, is accredited to Australia. Albania is represented in Australia by an Honorary Consulate-General in Adelaide. The 2006 Census recorded 11,315 people of Albanian ancestry living in Australia. Albania's national day is celebrated on 28 November.

Trade between Australia and Albania is small; two way merchandise trade in 2010 totalled A$1.9 million. In 2010, Australian exports to Albania were valued at A$1.5 million and consisted mainly of beef, raw hides and skins (excluding furskins) and butter. Imports from Albania for the same period were valued at A$0.36 million and consisted mainly of clothing.

In recent years, the Australian Government and a number of humanitarian aid organisations such as the Children First Foundation and the Melbourne Overseas Missions have provided financial and humanitarian assistance to Albania. Through the Embassy in Athens, Australia has supported several humanitarian projects with developmental benefits for local communities. For example, in 2009-10, the Embassy disbursed a total of A$20,000 to NGOs for programs relating to child development activities in remote rural areas as well as assistance for the reintegration of victims of trafficking.

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The Republic of Albania is a small, mountainous country on south-eastern Europe's Balkan Peninsula, bordering the Adriatic Sea to the west and with land borders to Greece to the south and Serbia and Montenegro to the east. Albania occupies an important strategic location in the Balkans along the Strait of Otranto which links the Adriatic Sea to the Ionian Sea and the Mediterranean Sea. The name Albania is derived from an ancient Illyrian tribe, the Albanoi, forebears of the modern Albanians. The Albanian name for the country is Shqiperise or 'Land of the Eagle'. The capital of Albania is Tirana and its national independence day is 28 November.

Albania's population is approximately 3 million (2011 est). The main minority groups are Greeks and Vlachs, Romany, Serbians and Bulgarians. Seventy per cent of Albanians are Muslims, 20 per cent Albanian Orthodox and 10 per cent Roman Catholic. [In November 1990, religious practice was again permitted after prohibition by the communist government in 1967.]

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Albania's political system is a presidential parliamentary democracy. The Parliament of Albania consists of a unicameral assembly known as the 'People's Assembly' or 'Kuvendi Popullor'. The assembly has 140 seats; 100 are elected by direct popular vote and 40 by proportional vote for four year terms.

The most recent elections for the assembly were held on 28 June 2009. The incumbent Prime Minister, Sali Berisha, was unable to secure an outright majority, winning 47.5 per cent of the votes (70 of the 140 seats). The opposition Socialist Party Coalition led by Edi Rama, won 38.8 per cent and pressed for a re-count of votes for many months during which it boycotted Parliament. The centre-left Socialist Movement for Integration led by former Prime Minister Ilir Meta won 6.5 per cent. On 9 September 2009, Albanian President Bamir Topi appointed Mr Sali Berisha as Prime Minister for another four years. Berisha's new government incorporates members of the Socialist Movement for Integration, the Republican Party and the Party for Democracy and Integration. The coalition government's key objective is to move Albania towards European Union accession. The People's Assembly elects the President for a five-year term, with the current presidency of Mr Bamir Topi ending in 2012.

Mr Bamir Topi, Deputy Chairman of the ruling Democratic Party, was elected President in July 2007 replacing Alfred Moisiu. A popular moderate in Albanian politics, Topi has been elected a member of parliament three times since the end of communism in 1991.

Topi won 85 votes in the presidential ballot, one more than the minimum 84 required under the constitution. This came after 3 failed ballots where none of the presidential candidates achieved the required number. The deadlock that threatened to push the country to early elections was ended when some members of the opposition Socialist Party crossed the floor to vote for Topi.

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Albania joined NATO on 1 April 2009, following formal agreement to its accession at the Bucharest Summit in April 2008, and is a contributor of troops to the International Security Assistance Force. Albania applied to become a candidate country for accession to the European Union (EU) in 2009 and is recognised by the EU as a "potential candidate country". In November 2010 the EU recognised Albania's progress towards political and economic accession criteria but concluded that further improvements to governance and democratic stability were required before Albania could commence accession negotiations. The Organisation for Security and Co-operation in Europe (OSCE) has a mission in Albania led by Ambassador Eugen Wollfart.

Albania is a participant in the European Commission's Stabilisation and Association Process (SAP), which provides a strategic framework for bringing stability to the Balkans through achievement of a series of political and economic reform milestones, together with targeted financial aid to assist structural improvements.

The Albanian Government strongly supported the NATO intervention in Kosovo, turning over key facilities to NATO during the period of the conflict with the Federal Republic of Yugoslavia (FRY). Following the commencement of NATO air strikes on 24 March 1999, 465 000 refugees from Kosovo crossed into Albania. The Kosovo Peace Plan was adopted by the UN Security Council on 10 June 1999 and the subsequent deployment of the NATO Peace Keeping Force in Kosovo (KFOR) prompted the spontaneous return of tens of thousands of refugees. The UN High Commissioner for Refugees (UNHCR) established an assistance program for the voluntary repatriation of the refugees and by 1 September 1999, 432 500 refugees had returned to Kosovo from Albania.

The Government has remained committed to ensuring stability in Kosovo and has continued to call for the protection of the rights of ethnic Albanians in Kosovo and the former Yugoslav Republic of Macedonia (FYROM). Albania's formerly poor relations with Serbia during the 1990s improved following the removal from power of the late Slobodan Milosevic in 2000 which opened the way to the eventual restoration of full diplomatic relations in late 2002. A further step towards co-operation between the two countries occurred on 5 July 2011 with Albania and Serbia lifting visa requirements for each other's citizens. Relations between Albania and FYROM likewise improved following parliamentary elections in FYROM in September 2002, which produced a coalition government with a strong ethnic Albanian presence.

Albania has been responsible for a number of initiatives and played a constructive role in the region, and showed willingness to address the issue of people smuggling over the Adriatic and Ionian Seas. It has also made progress in addressing money laundering and organised crime issues in partnership with the EU, the US and other national and international agencies — including the AFP and AUSTRAC.

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Albania is now making the difficult transition to a more open-market economy. Inflation for 2010 was 3.6 per cent. The government has introduced measures to reduce crime and has implemented a fiscal reform package to improve the economy and attract foreign investment.

Twenty per cent of Albania is fertile, arable land. It has untapped natural resources (including chrome — one of Albania's most important sources of hard-currency income) and a strong human resource base (a young population and a national literacy rate of 98.7 per cent). The median age is 30.4 years as of 2011 and 47.8 per cent of the workforce is employed in agriculture, with the rest in industry and services (2010 est.). Unemployment officially stands at 13.5 per cent (2010 est)

Although agriculture is Albania's largest sector, it is yet to modernise and small landholders predominate. This has caused inefficiency in the agricultural industry and, in addition to energy shortages, has stalled foreign direct investment (FDI) - the lowest in the region. The Albanian Government has developed a new thermal power plant near Vlore and plans to upgrade transmission lines between Albania and Montenegro and Kosovo to help relieve the energy shortages. Fiscal and legislative reforms have also been introduced in an attempt to improve FDI.

Albania's main industries include food processing, textiles and clothing, lumber, oil, cement, chemicals, mining, basic metals and hydropower. Export commodities include textiles and footwear, asphalt, metals and metallic ores, vegetables and tobacco.

Albania remains an extremely poor country by European standards, with 12.5 per cent of the population living below the poverty line (2008 est). Around 15 per cent of Albania's GDP results from remittances from Albanians working abroad, mostly in Greece and Italy. Workers' remittances and foreign aid are expected to continue to offset a widening trade deficit.

Whilst the Albanian economy has been partially sheltered from the global financial crisis, the impact has materialised in a slower economic growth. Greece's economic crisis has also prompted some Albanian workers to return home, resulting in a decline in remittances.

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Last Updated: August 2011

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