Nations in Transit - Albania (2005)

Capital: Tirana
Population: 3,200,000
Status: Partly Free
PPP: $1,450
Private Sector as % of GNI: na
Life Expectancy: 74
Religious Groups: Muslim (70 percent), Albanian Orthodox (20 percent), Roman Catholic (10 percent)
Ethnic Groups: Albanian (95 percent), Greek (3 percent), other (2 percent)

NIT Ratings	1997	1998	1999	2001	2002	2003	2004	2005
National Governance	N/A	N/A	N/A	N/A	N/A	N/A	N/A	4.25
Electoral Process	4.25	4.50	4.25	4.00	3.75	3.75	3.75	3.75
Civil Society	4.25	4.25	4.00	4.00	3.75	3.75	3.50	3.25
Independent Media	4.75	4.75	4.50	4.25	4.00	4.00	3.75	4.00
Local Governance	N/A	N/A	N/A	N/A	N/A	N/A	N/A	3.25
Judicial Framework and Independence	N/A	N/A	N/A	N/A	N/A	N/A	N/A	4.50
Corruption	N/A	N/A	6.00	5.50	5.25	5.00	5.25	5.25
Democracy Rating	N/A	N/A	N/A	N/A	N/A	N/A	N/A	4.04

Executive Summary

Albanian democracy is at a critical juncture; unless the upcoming 2005 parliamentary elections are free and fair, the country's fragile political stability can be seriously undermined along with its European Union (EU) integration prospects. After a series of elections that were continuously improving but did not qualify as completely free and fair, the international community made it clear that Albania's EU integration will proceed only if the country can show that it can hold free and fair elections. On the other hand, Albania's main political opposition, the Democratic Party, has declared that it will use protests to overthrow the ruling Socialist Party majority if it manipulates the upcoming elections. Albania held great promise in the early 1990s when the Communist system collapsed and the Democratic Party came to power. Two events, however, combined to wipe out some of the advances made during Democratic Party rule: the fraud-filled 1996 parliamentary elections and the chaos that ensued following the bankruptcy in 1997 of popular pyramid schemes, in which many Albanians had invested their life savings. The growing authoritarian tendencies of Democratic Party leader Sali Berisha also contributed to the deep unpopularity of the government, which lost to the Socialist Party in early elections held in 1997. The Socialist Party succeeded in rebuilding state institutions and reestablishing the rule of law, leading to economic growth and macroeconomic stability. In January 2003, in recognition of the progress made and to provide encouragement, the EU opened negotiations on a Stabilization and Association Agreement for Albania, a major step toward eventual accession. However, electoral processes that fell short of democratic standards, corruption, and state capture have continued and consolidated during Socialist Party rule. These phenomena now threaten the future of Albania's democratization as well as its prospects for EU integration.

Stagnation and scandals are the words that best describe the year 2004. A series of scandals widely aired in the media stirred protests by the opposition and civil society groups. Protracted fighting within the Socialist Party continued to dominate national politics. In September, Ilir Meta, a former Socialist Party prime minister, along with some other Socialist Party deputies, created the Socialist Movement for Integration, reducing the party's numbers in the Parliament. These developments diverted the focus from improving governance to preserving the fragile power balances within the Socialist Party, at a time when the Democratic Party began increasingly hostile attacks on the ruling Socialists. In January 2004, the Democratic Party demanded the resignation of Prime Minister Fatos Nano through a campaign called Nano, Leave!, but the movement ultimately faded without tangible results. Progress on electoral reform and preparations for parliamentary elections have been slow, despite the fact that these elections will be a decisive test of Albania's democratization.

National Democratic Governance. Governance during 2004 has been characterized by a strained effort to preserve the fragile equilibrium among different factions within the ruling Socialist Party in order to avoid a government crisis that could result in early elections. Such distractions have severely limited the ability of the government to curb corruption, push for reforms, and accelerate the process of EU integration. The current cabinet has not lived up to its moniker the Coalition for Integration as the year showed few advances, capped by a failure to sign a Stabilization and Association Agreement with the EU. The country's governance system remains fragile, as demonstrated by the threat of the opposition to overthrow the ruling Socialist Party if the upcoming elections are not free and fair. A number of high-profile scandals within the executive have demonstrated that this branch remains unaccountable to the public, while the legislative branch has often failed to properly monitor the work of the executive. The new rating for national democratic governance is set at 4.25 owing to fragility in the established democratic governmental system and only partial implementation of checks and balances and public accountability.

Electoral Process. None of the electoral processes held in Albania since 1996 have qualified as completely free and fair, even though international observers have deemed them acceptable. A lack of political will has been the main culprit, although the relevant legislation the Albanian electoral code is currently undergoing improvements to remove unclear legal formulations, loopholes, and other technicalities that might sully the electoral process. The bipartisan commission that was set up to carry out electoral reform reached an impasse because of the refusal of Socialist Party representatives to agree to political balance in the Central Elections Committee. Even though the impasse was resolved in late October, a series of major issues concerning electoral reform remained unresolved by the end of 2004. Overall, current electoral reform does not show any signs of real progress, meriting a rating that remains at 3.75.

Civil Society. Civil society organizations in general became more active during 2004, mobilizing popular support through public protests on a variety of issues ranging from ecological matters to consumer rights. Nevertheless, some of the serious sustainability issues and structural problems that threaten the efficiency of nongovernmental organizations (NGOs) have not been resolved. These groups still remain donor-dependent and at times reflect donor rather than local priorities. Other instruments of civil society, such as labor unions, show no observable progress. Albania's civil society rating improves from 3.50 to 3.25 owing to increased activity aimed at influencing government policy.

Independent Media. Albanian media continued to mushroom during 2004. New publications and electronic media outlets entered an already crowded market, while the existing ones made advances in terms of technology. Media continued to evolve within the constraints of a distorted market and problematic ownership structure. At the heart of these constraints remains the subordination of media outlets to special business and/or political interests that they are intended to promote and protect. Media owners directly decide on editorial policy according to their immediate political or business expediencies, meaning editorial independence is very limited. That, in turn, continues to undermine the credibility of the media, as reflected in low readership levels. During 2004, in a number of important cases, the courts ruled against independent media and in favor of high-ranking politicians. Despite the increased number of media outlets, persistent challenges to editorial independence presented by ownership and court rulings against independent media that favor the political elite contribute to a decline in Albania's independent media rating from 3.75 to 4.00.

Local Democratic Governance. On the positive side, decentralization made further advances during 2004. Financial autonomy, especially for the main municipalities, has been increasing steadily. The legislative framework has been updated and is conducive to a decentralization of competencies from the central to the local government. The ability of local governments to respond to citizens' needs has been improving, and in most national surveys, respondents rate the work of local authorities higher than that of the central government. However, local governments must do more to increase their openness to their constituencies. In addition, a number of important sectors, such as education and water supply, which should have been decentralized earlier, remain in the hands of the central government. The charged political climate has had a negative impact on local governments, especially in municipal (urban) and commune (rural) councils, where political agendas often override local priorities. Albania's new rating for local democratic governance is set at 3.25. Although further decentralization of some basic services, along with increased capacities for local governments, are still needed to improve transparency and responsiveness, governance remains most effective at the local level.

Judicial Framework and Independence. The Albanian judiciary continues to be perceived as one of the most corrupt institutions in the country. Little or nothing changed in this regard during 2004 in terms of both public perceptions and concrete measures taken to increase its efficacy and reduce corruption. Also showing no sign of improvement and even a certain degree of deterioration were the lack of execution of court decisions, shortcomings in due process, and problematic detention conditions. Some court rulings in favor of powerful politicians cast doubts over the independence of the judiciary. The rating for judiciary framework and independence falls from 4.25 to 4.50 owing to persistent failures to enforce judicial decisions and to the judiciary's continued functioning as a closed and unaccountable institution that remains susceptible to political influence.

Corruption. On paper, Albania has an impressive legislative and institutional anticorruption framework. However, the government has shown little political will to fight corruption beyond its anticorruption rhetoric. During 2004, a number of scandals involving state institutions and officials have negatively impacted popular perceptions on corruption. The Law on Declaration and Control of Assets, an important legislative achievement, was first implemented in 2004. Although this in itself was a positive development, the declarations of assets by some top state officials and the consequent verification served to heighten rather than lower popular perceptions on corruption. Albania's corruption rating remains at 5.25 owing to the persistence of scandals involving state institutions and individuals, the unsuccessful fight against corruption, and the public's growing perception of widespread corruption.

Outlook for 2005. The most important events for 2005 are the parliamentary elections, which are scheduled to take place on July 3. On more than one occasion, the EU has made it clear that Albania's integration process will depend on whether the upcoming elections are free and fair. The opposition, on the other hand, has declared that it will no longer tolerate a compromised electoral process, citing the examples of Ukraine and Georgia as possible responses to emulate in the case of electoral fraud. The Democratic Party is desperate to return to power after eight long years in opposition – otherwise its political survival, along with that of the party's chairman, Sali Berisha, may be jeopardized. Similarly, the ruling Socialist Party seems frantic to hold on to power. Many high-ranking Socialist Party officials would like to protect their business fortunes and remain immune to the corruption charges they fear the opposition could use against them if it comes to power. The stakes are high, and the preelectoral period has been characterized by growing tensions and mistrust. Without an election that lives up to international expectations, the fragile fabric of Albanian democracy may tear and the country could easily relapse into instability.

National Governance (Score: 4.25)

Albania is a parliamentary republic. Its president, elected by the Parliament through a qualified majority of three fifths, has limited and largely symbolic powers. The Parliament is a unicameral body with 140 seats contested every four years. One hundred seats are filled through a first-past-the-post system, whereas the remaining 40 seats are filled through proportional voting. The threshold for gaining representation in the Parliament is 2.5 percent for political parties and 4 percent for political coalitions. The Albanian Constitution provides for a system of checks and balances among the legislative, executive, and judicial branches. In practice, the system remains fragile and the separation of powers is not yet complete, with the executive branch clearly having the upper hand over all the other institutions of government.

During 2004, the ruling Socialist Party experienced bitter infighting between two competing factions, one led by Prime Minister Fatos Nano and the other led by Ilir Meta, former deputy prime minister in Nano's cabinet. In September, nine parliamentary deputies of the Meta faction left the Socialist Party to form the Socialist Movement for Integration, reducing the Socialist Party majority in the Parliament. As a result, governance during 2004 was dominated by a strained effort to preserve the fragile equilibrium among different factions within the Socialist Party to avoid a government crisis that could result in early elections. All the distractions limited the ability of the government to push for reforms and accelerate the process of European Union (EU) integration. A declaration of the EU presidency on September 14 said that "insufficient progress is being made in reform implementation and in particular in areas that are vital for Albania's future and its successful integration." In the same fashion, the fight against corruption has produced much rhetoric but little real progress, as indicated by both a number of scandals involving public officials and a 2004 report by Transparency International, which rated Albania just as corrupt in 2003 as in 2004.

Following the drowning of 20 Albanians who were being smuggled to Italy on January 9,2004, the opposition called for a parliamentary investigation, blaming the government for failing to act in a timely fashion to rescue the victims after they had requested help. The accident stirred much public reaction owing to the fact that despite news of the drowning, Prime Minister Nano did not interrupt his weekend holiday abroad to return to Albania. Public reaction culminated in a protest organized by the Mjaft! (Enough!) movement and a demand for a public apology from the prime minister. The Democratic Party launched a "Nano, Leave!" campaign calling for the prime minister's resignation. The first public protest took place in Tirana and was marked by clashes between protesters and security forces, without any casualties. The campaign eventually lost momentum without any concrete results.

Every political crisis in Albania sends ripple effects throughout the public administration. State institutions are not immune to political changes and pressure. The situation has improved since the passage in 1999 of the Law on Civil Service, which protects civil servants from arbitrary dismissal and mandated the establishment of a Civil Servant Commission. Government statistics show that the number of people who apply per position in public administration has increased significantly, from an average of 6 during the last three months of 2003 to an average of 10 for the first six months of 2004. More places in public administration were advertised in 2004 as compared with 2003, perhaps indicating that fewer employees owe their jobs to political patronage. Furthermore, the Institute for Training the Public Administration, a government agency, has educated a larger number of public administration employees in 2004 than in 2003.

However, public administration in Albania still faces a number of problems, such as lack of motivation on the part of civil servants owing to small salaries and poor organization. The number of employees who enjoy civil servant status remains very small compared with the number of people employed in public administration, which means that the Law on Civil Service actually still protects too few public administration employees. The passage in 1999 of the Law on the Right to Information on Official Documents, which mandates free access to public information, has not changed old habits of operating in a closed fashion. In 2004, the Center for the Democratization and Development of Institutions, an Albanian nongovernmental organization (NGO), published a study concluding that the existing law had rarely been implemented over the past year. According to the London-based Article 19, a press rights group, some 87 percent of state employees questioned in a poll did not even know the law existed. Civil servants are not yet in the practice of serving the people, so the government remains nontransparent and detached from the public at large.

The Albanian Parliament has been gaining steadily in importance and has become the main forum for political debates. During 2004, new rules of parliamentary procedure were finalized and ratified. They establish more comprehensive criteria on how parliamentary groups can be formed, how draft laws can be scrutinized more rigorously before they turn into laws, and how parliamentary commissions can better coordinate their operations. They are expected to further improve the work of the Parliament, especially with regard to the quality of the legislation that will be produced. Measured by the quantity of legislation passed, the Parliament has not substantially improved its level of efficiency (the figure was 174 laws for 2004 compared with 176 for the previous year). The process through which important new legislation is approved has not shown improvement, either. For example, the Law on Property, a key piece of legislation that aims to regulate and distribute landownership, was not passed consensually. The opposition boycotted the session after the Socialist Party parliamentary majority refused to incorporate into the law some of its recommendations pertaining to the amount of land restitution and financial compensation for landowners that was expropriated by the Communist regime. In the same fashion, no agreement was reached on electing the head of the Land Restitution Committee, undermining the successful implementation of such an important law.

The growing political tension between the two main parties, the ruling Socialist Party and the opposition Democratic Party, has also undercut the Parliament's ability to perform oversight of the executive. In November 2004, for instance, the opposition parties in the Parliament asked for the establishment of a parliamentary committee that would investigate allegations that Nikolle Lesi, a member of Parliament (MP), had made against Prime Minister Nano. Lesi, chairman of the Christian Democratic Party and publisher of the daily newspaper Koha Jone, accused Nano of involvement in arms-trafficking deals and of killing a citizen in a car accident, providing alleged secret service surveillance transcripts as evidence. But the Socialist Party majority voted against establishing the committee, even though the Constitution clearly stipulates that investigative commissions must automatically be set up upon request of one fourth of the MPs.

Civilian officials in the government have close oversight over the military and security services but interfere excessively in the selection of personnel for these forces. Appointments are often based not on meritocracy, but on political favoritism or nepotism, which undermines the efficacy of the military. The security services, just like the military, are also under control the executive.

Electoral Process (Score: 3.75)

Since the parliamentary elections held in 1996, there have been two national and two local elections in Albania, none of which has qualified as free and fair, although international monitoring organizations have deemed them acceptable. The monitoring mission of the Organization for Security and Cooperation in Europe (OSCE) labeled the last local elections, held in 2003, "a missed opportunity for significant progress toward compliance with&international standards for democratic elections." Compromised electoral processes have undermined the legitimacy of the governments they have produced and their ability to conduct reforms successfully, while increasingly alienating the opposition from the democratic process and thus contributing to political polarization. The situation has deteriorated to the point that the main opposition, the Democratic Party, has often declared in reference to the upcoming 2005 parliamentary elections that it will no longer tolerate another term in power of the ruling Socialist Party based on elections that international observers do not judge free and fair. Given the election's potential for destabilization and its role as a further test of the country's maturity, Osmo Liponen, former OSCE ambassador in Albania, has called the vote "the ticket to [Albania's] integration, be it in the security structures or in the European Union."

After the local elections of 2003, the Socialist Party and the Democratic Party set up a bipartisan ad hoc electoral commission in September 2004. The commission aimed to improve the electoral code according to recommendations provided by the Venice Commission and by the OSCE in its report on the local elections. The most important suggestion concerned the formation of a politically balanced Central Elections Committee (CEC) instead of one that is dominated entirely by the Socialist Party and improving the voter lists to include many people excluded during the local elections.

Once the bipartisan commission started work, however, no agreement could be reached on the actual recomposition of the CEC. The Socialist Party refused to accept the replacement of one of its members with one whom the Democratic Party proposed, arguing that the move would be unconstitutional because the individual's mandate would be terminated before the time stipulated in the Constitution. In retaliation, the Democratic Party boycotted the bipartisan commission. The impasse continued until the end of October, when the Socialist Party, pressured by the EU, agreed to accept one of the versions offered by OSCE experts, which called for the termination of a current CEC member's mandate and his replacement by a candidate whom the opposition had proposed. In October, the Parliament approved a transitory clause for the recomposition of the CEC, meaning the CEC will be politically balanced, with four members proposed by the Socialist Party and three members by the Democratic Party. Decisions on important issues require a five-out-of-seven vote, preventing either of the two main parties from taking important decisions without consent of the other. The Parliament also passed the Law on the Registration and Verification of Citizens, which regulates the registration process for the 2005 parliamentary elections. Local government units are now responsible for registering and identifying citizens in their areas and producing new voter lists, a duty that the Ministry of Local Government and Decentralization formerly performed.

In a November 5 press conference, Pavel Hacek, the current OSCE ambassador in Albania, called the process leading up to the elections painfully slow and short on results. He said that the Parliament still had to resolve outstanding issues in reviewing and amending the provisions on election day voting procedures, electoral zones, allocation of proportional mandates, and some other issues.

Yet based on past experiences, improving certain shortcomings of the electoral code will not in itself produce free and fair elections. The code has been reformed after every major vote without producing a clean election. The only parliamentary elections that have qualified as free and fair in post-Communist Albania were those of 1992, when the electoral code had yet to be reformed but the ruling Labor (Communist) Party lacked the political will to manipulate the electoral process. Since then, the authorities have not demonstrated the resolve to hold a truly democratic vote, and the protracted process of the electoral reform in 2004 calls into doubt whether the situation will change in time for the upcoming elections.

One issue that changes in the electoral code will do little to solve is falling voter turnout. The 2003 local elections marked the lowest figure in post-Communist Albania, at 45.7 percent of the electorate. People have grown disenchanted with politics in general and the two main political parties in particular, which does not bode well for increased turnout in the upcoming parliamentary elections. No legal or other impediments prevent the creation of political parties only 500 signatures are needed to establish and register a political party, and the state budget provides significant finances for parties. The primarily majority system, as in other countries and in combination with other sociological factors, has led to the domination of the political scene for the last 15 years by the Socialist Party and the Democratic Party.

The Albanian Human Rights Party represents minorities in the Parliament, focusing its efforts chiefly on defending the rights of the Greek minority, though it ostensibly lobbies for other minorities as well. The largest and least politically represented minority in Albania are the Roma.

Civil Society (Score: 3.25)

No civil society organizations existed in Communist Albania, so when the former regime collapsed, the country inherited neither NGOs nor a tradition in this area. International donors and NGOS introduced and developed the concept in the early 1990s, focusing mostly on humanitarian aid and emergencies and setting up local NGOs with which they could cooperate. The 1997 crisis, which followed a faulty election and the collapse of widespread pyramid schemes, temporarily disrupted the evolution of civil society organizations. They recovered, however, and have continued to grow in numbers and capacities. Still, almost 14 years after the fall of Communism, the civil society sector in Albania still consists of a number of local NGOs almost entirely dependent on international donor funding and often more in touch with donor rather than local priorities.

During 2004, NGOs became increasingly active, at times confronting the government on specific issues, mobilizing the population in public protests, and expanding some of their efforts outside of Tirana, which remains the focus of their activities. Following the January 9,2004, drowning of 20 Albanians who were being smuggled to Italy, the Mjaft! movement organized a demonstration that drew thousands of citizens in front of the prime minister's office. Capitalizing on the feeling prevalent at the time that Prime Minister Nano had shown indifference to the deaths, Mjaft! leaders called on Nano to make a public apology, but he refused.

Mjaft! also collaborated with a number of other NGOs and interest groups in the coordination of another high-profile protest, this time against a plan to set up a waste management plant in Albania that would import large quantities of waste from Italy. This was one of the rare cases when a number of Albanian NGOs worked together, without the encouragement of a donor, to protest a governmental decision. One reason may have been that Koco Kokedhima, a powerful Albanian businessman and owner of the biggest daily newspaper, Shekulli, had been a driving force behind the project. Kokedhima's offer to build a waste management power plant had been rejected by the government in favor of a bid by an Italian company. In addition to the negative environmental impact of the waste imports, the secrecy of the deal upset the protesters, as the local community where the government intended to locate the plant did not know the details of the deal. In the end, the government backed down and the plan was put on hold.

Another instance of the growing power of NGOs is the work of a local group, the Citizens Advocacy Office (CAO), which provides free legal support and advice to citizens. The CAO organized meetings with citizens around the country to protest unfair practices by major state and private telephone companies, and in particular the decision of the state monopoly Albtelecom to raise tariffs for fixed telephone lines. The meetings served the double purpose of raising civic awareness and educating local communities on how to stand up for their rights, providing them with successful examples of collective action. Due to such pressure telephone tariffs did not increase.

Despite these recent success stories, the fundamental shortcomings of civil society organizations in Albania have not changed much. Most NGOs are still entirely dependent on funding from foreign donors. Domestic sources of funding are almost nonexistent, and there are no clear government policies to support the sector through public funding. In most cases, NGOs in Albania are one-man shows with practically no membership beyond their employees. Although most NGOs do have advisory and executive boards, in practice such organs do not function at all. Ultimately, donor dependency combined with structural shortcomings undermines the ability of NGOs to represent local concerns and fulfill objectives that satisfy local priorities.

Cooperation among NGOs remains inefficient and takes place primarily because of donor funding. Pressured to work together from the outside, these coalitions rarely function well and fail to attract membership beyond a hard-core group of mostly aid-dependent NGO service providers. One of the coalitions that has often been cited as successful in Albania the Albanian Coalition Against Corruption derived almost all its legitimacy from its donor, the U.S. Agency for International Development (USAID), and was popularly seen as the USAID's coalition rather than an indigenous movement to fight corruption. According to a report by the Center for Policy Studies at Central European University, the coalition dissolved immediately once donor funding ended, since it was neither sustainable nor attractive to the member organizations when it no longer offered them funding opportunities.

The activity of civil society organizations in Albania is regulated through the Law on Not-for-Profit Organizations and the Law on the Registration of Not-for-Profit Organizations, both of which the Parliament passed in May 2001. While experts consider this legislation up-to-date and progressive, as with a number of other laws, some shortcomings remain in its implementation. Numerous NGOs have failed to register under the new law, and the tax police continue to engage in unwarranted intrusions into the financial affairs of NGOs based upon business tax regulation rather than any existing or pending NGO tax regulation. In some cases, the government has used the financial police as a pressure tool to silence civil society organizations that have criticized government policies or ministers. In September 2004,22 NGOs issued a press release accusing the financial police of starting a campaign against them after their critical stance on government corruption and bad governance. In other cases, the police have improperly deemed civil society group protests as illegal, and authorities have sometimes filed charges against the organizers. For example, on one occasion police prevented the Mjaft! movement from staging a protest, while in another instance the group was charged with violating the rules for holding a demonstration although in both cases Mjaft! had notified the authorities on time, as the law requires.

No major developments took place in the labor movement over the course of 2004. The Constitution guarantees the right to form trade unions, and workers exercise this right in practice. The labor code, adopted in 1995, also affirms the right of workers to form trade union federations or confederations. A minimum of 20 people can form a trade union. The two main unions are the Confederation of Trade Unions of Albania (KSSH) and the Confederation of Independent Trade Unions of Albania (BSPSH). Together, they represent slightly under 200,000 workers, which constituted approximately 20 percent of the labor force in 2004. The KSSH has links with the ruling Socialist Party on the left, while the BSPSH supports the opposition Democratic Party on the right. The Council of Employers Organization represents employers' interests. Since the economy remains based mainly on small, family-run businesses rather than larger industrial concerns, trade unions are not powerful actors in Albanian society. Combined with their organizational weaknesses, such as the low amount of dues collected, their political affiliations harm their credibility and their ability to promote membership interests, which in turn results in a limited capacity to mobilize human resources.

Universities and the educational system in general are free of political propaganda and influence, though cases have occurred in high schools of schoolmasters selected on the basis of their political sympathies. The quality of teaching in universities remains low, and deans and university administrations continue to run schools in a centralized, nontransparent, and inefficient way. Universities are still very dependent on the Ministry of Education for most of their funding and do not yet enjoy full autonomy in administering their own financial resources. With limited donor money spent within the university structure, meager financial resources have undermined the ability of institutions of higher learning to conduct research and play a greater role in Albanian social development.

Independent Media (Score: 4.00)

The year marked some improvements in terms of the quality and diversity of media outlets, as well as progress in creating media legislation that meets international standards. However, the media continued to evolve largely within the existing limitations of a distorted market and a problematic ownership structure. At the heart of these constraints remains the subordination of media outlets to special business and/or political interests that they are intended to promote and protect. Media outlets are run not as businesses in their own right, but as a means to attract and promote investments made elsewhere. One sign of that is the large and growing number of media outlets in such a small market (a population of a little more than 3 million and a readership of no more than 80,000). In a July 5,2004, parliamentary debate on the media, Prime Minister Nano observed that Albania has the largest number of print media per capita in Europe, but the lowest circulation per capita.

An estimated 200 publications were available in 2003, including daily and weekly newspapers, magazines, newsletters, and pamphlets and this number continued to grow during 2004. The number of daily papers in Albania increased from 19 in 2003 to 21 in 2004; licensed radio stations increased from 43 in 2003 to 49 in 2004; and TV stations, including cable TV channels, increased from 70 in 2003 to 85 in 2004.

The proliferation of media outlets has had a positive effect on the diversity of information offered in the media market, and enhanced competition has led to a marked improvement in quality and a greater degree of professionalism. Yet the freedom of media to investigate and report on sensitive issues, such as connections between high officials and organized crime, has not grown in proportion to the number of media outlets.

One of the common features of the electronic and print media in Albania is their concentrated ownership structure. According to the Law on Private and Public Radio and Television, no single owner may control more than 40 percent of the shares in a nationwide radio or television station. However, some media analysts have reported violations, with single owners controlling up to 50 percent. Print media ownership is often concentrated in the hands of a single family, shared mainly among siblings or between conjugal partners. In addition, owners often use their other businesses to finance their media holdings, hardly surprising since according to the 2003 report of the National Council of Radio and Television (NCRT) around half of the television stations operate with losses. According to the NCRT, the undeclared use of outside financial sources opens up the possibility for illegal financing and the use of media to promote special interests.

Overall, the lack of diverse ownership groups and the stress involved in defending the owners' business interests have severely limited editorial independence, especially given the lack of job security and contracts in the media sector (the majority of journalists and media workers are uninsured). The lack of transparency in financing various media also makes them vulnerable to government control and pressure. In their placement of print advertising, state officials already have a powerful carrot and stick to secure positive coverage, since these types of ads make up an estimated 60 percent of the limited advertisement market in print media. Government has little incentive to clean up the situation – partly because some officials own media, partly because politicians do not want to alienate media outlets and their financial backers, but mainly because preserving the status quo allows the state to exert greater control over the media. The end result are media that champion special interests rather than those of the public at large, which in turn has undermined the press's credibility. Not surprisingly, circulation rates remain remarkably low.

An inefficient distribution system privately run and poorly organized compounds the problem. Daily papers reach only some of the main urban centers and are completely absent in rural areas, while a subscriber-based system remains weak and largely nonexistent. Only if media become more market oriented, pushing them to increase their readership, will there be an incentive to expand and improve the distribution system.

Over the past year, the Parliament finally made some progress in anchoring the press rights enshrined in Article 22 of the Constitution, which states simply: "The press is free. The freedom of the press is guaranteed by law." After almost one year of discussion and debate, the Parliamentary Commission on the Media approved a draft Law on Print Media in September, but it was not approved by the Parliament in the plenary session, mainly because of a controversial provision that stipulated a price floor for print media that should not fall below the production cost. The Albanian Authority on Competition and a number of local print media criticized this provision as unfair, arguing that it would interfere with price setting and would thus distort market competition. The international press watchdog Reporters Without Borders condemned this provision on the same grounds. Other initial provisions of the draft law such as one that established an Order of Journalists that would license journalists and enforce some rules of ethics in the media were widely debated and eventually eliminated after a series of local and international media organizations criticized them as instruments that could be used to curb media freedom.

Although the draft Law on Print Media was initially hailed as good news, a growing number of journalists and analysts have expressed doubts as to whether the legislation will improve the media market or provide safety for journalists. They argue instead for stronger measures to regulate the placement of official ads, which are used to reward sympathetic media outlets and punish critics. The current Law on Public Procurement stipulates that government advertisements should be allocated to the three papers with the largest circulation. However, given that there are no official figures on circulation beyond estimates by the papers themselves, this opens up room for subjective and arbitrary allocation.

Press rights defenders also charge that legislation that covers libel must be improved to provide greater protection for journalists. According to the current law, defamation of public officials can result in penalties ranging from a fine to three years in prison. Although no court in 2004 ruled in favor of a prison sentence, lawsuits that resulted in fines have frequently been filed against individuals who have been outspoken in their criticism of government policies and public officials. According to a report by the Albanian Center for Media Monitoring, eight such cases occurred during the first six months of 2004, including the most publicized one: Prime Minister Nano's lawsuit against Nikolle Lesi, owner of the daily paper Koha Jone. The district court ruled against Lesi, who is also a member of the Parliamentary Commission on the Media, and imposed a fine of 2 million leke (around US$20,000) on the newspaper. In a letter to Nano, Andrew Puddephatt, executive director of the London-based press rights group Article 19, condemned the decision as politically motivated. The decision was criticized by Article 19 on several grounds, ranging from the exorbitant amount of the fine to certain procedural violations during the trial. Because of this case and similar developments, Albania's position in the Reporters Without Borders media freedom rankings dropped from 34th in 2003 to 50th in 2004.

Over the years, the Parliament has passed several laws designed to ensure the independence of public television. In 1997, after the Socialist Party came to power, the station's status was changed from that of a state institution to a public television station under parliamentary control. In 2003, the Parliament passed a special law mandating a balanced board of directors, five from each of the two major political parties and five representatives from the civil society sector. Despite these attempts, public television has continued to produce coverage favorable toward the government, because, many believe, the station's general director has close ties with Nano.

The year 2004 also showed the positive effects on the broadcast media market of a 2003 law aimed at reducing media piracy relating to stolen movies and television programs. Piracy in TV broadcasting dropped dramatically, and stations began to boost their offerings and improve their program production. Those developments, in turn, have stimulated and increased the advertisement market.

Internet usage remains limited in Albania, with only an estimated 30,000 citizens having an Internet connection approximately 1 percent of the population. However, the actual percentage might be higher, since a growing number of people who do not enjoy connections at home or in the office frequently use Internet cafés or other Internet facilities.

Local Governance (Score: 3.25)

Since the late 1990s, Albania has taken major strides in setting up a basic legal and institutional framework for the implementation of an accountable, decentralized, fiscal, and administrative structure. The 1998 Constitution established that local governments are founded on the principle of decentralization and that the relationship among the state, the regions, and the local governments is grounded on autonomy, legality, and cooperation. In 2000, the Parliament passed the Law on the Organization and Functioning of Local Government, which provides for local governmental autonomy and outlines the duties and responsibilities of local governments. The most important piece of legislation on local government, this law was followed by others that completed the legal framework for a functioning system of local government. In addition, Albania has ratified the European Charter of Local Government, which enshrines all the basic principles of democratic governance at the local level. At the moment, Albanian legislation on local government is in full compliance with at least 19 paragraphs of the charter, including 11 core sections that pertain to fundamental principles of democracy at the local level, such as local autonomy. Among others, the World Bank, in a 2004 report on decentralization, praised the country for possessing a solid legal framework that allows for functional decentralization.

Albania has two levels of local government. The first consists of 373 administrative divisions, of which 65 are urban municipalities and 308 are rural communes. The second consists of 12 regions. The communal, municipal, and regional councils are the representative organs of local government; the first two are elected directly, and together they elect the third. In municipalities, citizens directly elect the mayor; in communes, they choose the head of the commune. In each of the 12 regions, the central government appoints a prefect as its representative in the area.

Although many local governmental units, especially in rural areas, depend on funding from the central government, in general the financial autonomy of local governments has increased steadily since 2000. According to a study on fiscal decentralization commissioned by the Urban Institute, a well-known U.S. think tank, local governmental autonomous spending has increased from about 0.34 percent of gross domestic product in 2000 to nearly 2 percent in 2003. According to Stability Pact forecasts, this trend will continue. For 2004, the figure has been estimated to have risen to 2.11 percent; while small, this increase is a strong indicator of the government's commitment to fiscal decentralization. The improved numbers also reflect the advances made by local governments in raising their own resources through taxes and local fees, which has enhanced their ability to provide more and better services. This has resulted thanks to legislation that allows local government to collect their own taxes and their growing efficiency in collecting them. The major municipalities, with more resources to draw upon, have felt a greater impact than poorer cities and villages, which remain heavily dependent on financial inflows from the central government. These transfers consist of unconditional and conditional grants. The unconditional grants are delivered in a rather transparent manner through a formula that aims to avoid subjective allocation. The conditional transfer mechanism, on the other hand, is not transparent, and from the standpoint of local governments, these funds are far from certain. According to a World Bank report on decentralization, the Tirana authorities sometimes allocate these grants according to political preferences.

The areas where decentralization has proven difficult are education, water supply, and social assistance. Problems have arisen partly as a result of the ownership structure of these services and partly as a result of resistance from central government ministries and employees in these sectors. The government is preparing policy papers in these three areas with the assistance of local and international experts; the papers will be followed by pilot projects that should eventually lead to legislation for their decentralization.

The Constitution permits local governmental units to cooperate in order to represent their common interests domestically and internationally. Three such associations represent local governments in Albania: the Association of Municipalities, the Association of Communes, and the Association of Regions. These organizations operate under their own statutes, and membership is voluntary. The Association of Municipalities, the most active group, is better structured and better off financially than the other two and has a greater impact in the decentralization process.

Local government elections are held every three years. In contrast with earlier campaigns, a calm atmosphere, especially in Tirana, reigned during the latest elections, in October 2003. The campaign focused on issues most pertinent to citizens and was less politically charged than earlier ones. A wide range of candidates ran for office, although cases still occurred of various financial groups or other powerful special interests dominating the field. However, advances made in terms of election campaigning, media coverage, and electoral reform were overshadowed by irregularities with voter lists and by violations in the administration of ballot boxes after election day in the capital, Tirana. The election report issued by the OSCE/Office for Democratic Institutions and Human Rights (ODIHR) spoke of a missed opportunity for significant progress toward compliance with OSCE commitments and other international electoral standards.

Local governments in Albania enjoy greater credibility with citizens in comparison with central institutions. In a national survey conducted by the Institute for Contemporary Studies, an Albanian think tank, 60.5 percent of the respondents said they were either satisfied or extremely satisfied with the work of local government, in contrast with 36.7 percent with the central government and 26 percent with the Parliament. A series of subsequent surveys has confirmed these results.

Despite the favorable opinion of local governments, turnout in the latest elections was the lowest in Albania's post-1991 electoral history: 45.7 percent. That figure represented, in absolute terms, a 14.6 percent decrease in voter turnout compared with the last local elections, held in 2000. This is quite a significant drop despite changes in the number of eligible voters. Participation in the functioning of local governments also remains low. Many citizens remain unaware that local council meetings, which are poorly attended, are open to the public. Citizens are also not very familiar with the institutions of local government in general and the municipal council in particular. According to a survey conducted by the Albanian Institute for International Studies in 2002, only 45 percent of the respondents were aware that they elect municipal council members, while the majority did not know the name of the head of their council. The manner in which members are elected is part of the reason for such ignorance: Citizens vote for closed party lists and not for individual council members. Politicians' loyalties thus rest mainly with the nominating political party, and the incentive to canvass the populace for votes and then seek input from the electorate is very low. Debates within the councils are often overly politicized and less focused on community priorities.

This overdependence on political parties makes local governments vulnerable to political shocks that come from the center. During 2004, in at least two instances, party politics appeared to take precedence over the proper functioning of local governments. In the Kamza municipality, the new mayor from the Democratic Party fired a large number of state employees, allegedly because of political reasons. In the Korca municipality, where another Democratic Party member had won the election, the Socialist Party dominated central government refused to transfer funds, citing a sizable debt (which had, however, been incurred under the previous Socialist Party mayor). These are not isolated cases: Local governments controlled by opposition parties often receive less funding than those in the hands of the ruling party.

Judicial Framework and Independence (Score: 4.50)

Albania has a three-layered court system: district courts, courts of appeal, and the Supreme Court. The president proposes the names of Constitutional Court and High Court judges, and the Parliament must give its approval. Judges then serve nine-year terms. The Constitutional Court interprets points of the Constitution after receiving a request from the Parliament or other state institutions. The High Court, on the other hand, is the last instance of appeal after the courts of appeals. The main role of the High Council of Justice (HCJ) is to appoint, transfer, discipline, and dismiss judges and to regulate the work of the judiciary in general. The HCJ comprises 15 members, including 9 judges elected by the National Judiciary Conference, which brings together all the judges in Albania. The remaining 6 become members automatically by virtue of their position, such as minister of justice or president of the Albanian Republic. Constitutional provisions guarantee the HCJ's independence from the executive and the legislative, but some legal experts believe that this autonomy might undermine accountability especially because judges dominate the main body intended to discipline their colleagues.

The quality of appointed judges has been improving steadily, although the legal education offered in Albania remains poor. In addition to a four-year-long undergraduate education in law, the vast majority of new district court judges appointed after 1999 have completed studies at the Albanian School of Magistrates, an intensive three-year program of which the last year is a court internship. The school also offers continuing education through professional courses for active-duty judges.

The appointment of those who graduate from the magistrate school appears to be based largely on objective criteria, and political and personal influences seem to be the exception rather than the rule. Connections tend more to influence the particular court where judges are appointed than the appointment per se. Nevertheless, criteria for an appointment to courts other than the district ones are still vague, and according to the American Bar Association/Central European and Eurasian Law Initiative Judicial Reform Index, it is widely believed that advancement of judges through the judicial system sometimes results from personal connections rather than merit.

Albanian legislation is generally in line with European standards. Legislation, however, is too often passed just to please the international community, creating a gap between the law on paper and the law in reality, a conclusion reached by Reinforcement of the Rule of Law, a 2004 European Commission report. In addition to guaranteeing a wide range of human rights including freedom of expression, religious freedom, freedom of association, and business and property rights the Constitution invokes the European Convention on Human Rights (ECHR). In practice, adjudication of most alleged human rights violations initially takes place in the regular court system, where ECHR provisions are rarely applied. The right to a fair trial is not properly respected owing to a variety of shortcomings, such as excessive delays in judicial processes, poor public legal counseling, lack of publication of court decisions, violation of trial procedures, rulings made on insufficient evidence, and weak enforcement of court decisions. According to a survey conducted by the Albanian Helsinki Committee in 2004, only 40 percent of the interviewees confirmed that their defense lawyer had regularly attended their legal processes. In general, the state has made neither an effort to ensure fundamental human rights nor a systematic attempt to curb their violation.

Corruption remains one of the most urgent problems, undermining the credibility of the Albanian judiciary in the eyes of the public. A survey conducted by the Albanian Institute for International Studies in December 2003 revealed that almost half of the respondents believed courts were some of the most corrupt institutions in the country. Such perceptions are fueled also by the fact that no judges have been prosecuted on charges of corruption so far and that the number of disciplinary measures did not increase from 2003 to 2004. In each year, six disciplinary measures were taken, of which three consisted of discharging judges from their duties and three were warnings.

The Directorate of Inspection of the HCJ supervises judges. The Directorate of Inspection at the Ministry of Justice, however, seems to have overlapping competencies and functions, a cause of contention between the two bodies. While the HCJ claims that inspection by the executive violates the independence of the judiciary, the ministry argues that the judge-dominated HCJ cannot properly perform oversight of the judiciary. In general, many analysts believe that the appeals for greater independence have allowed the judiciary to grow increasingly unaccountable and corrupt, which in turn has made it more susceptible to political threats and influences.

The poor execution of court decisions and predetention conditions are two other serious shortcomings of the Albanian justice system. According to data from the Ministry of Justice, in the first six months of 2004, the rate of execution of court decisions was 34 percent considerably lower than the 2003 execution rate of 52 percent. However, of particular concern is the fact that state institutions do not respect court decisions and do not allocate part of their budget to compensate individuals or subjects against whom they have lost court cases, arguing that they do not have sufficient funds. This constitutes a violation of constitutional provisions.

Predetention conditions also remain a major concern. In many cases, police hold detainees in appalling conditions and overpopulated rooms. In violation of a number of legal provisions, juveniles are sometimes held in the same cells with adults. One recent incident concerned 12 juveniles who shared a cell with a group of adult prisoners, some of whom had been accused of committing serious crimes, such as murder and rape. The Albanian Human Rights Group (AHRG) a local NGO, also reported the case of a juvenile detainee who allegedly died because of police maltreatment. In large part, the Ministry of Public Order still manages predetention facilities, although legally the Ministry of Justice should play that role.

The Constitution includes measures designed to isolate the judiciary from political influence. In order to elect Constitutional Court and High Court judges, for example, a qualified majority of two thirds is needed in the Parliament. However, the ruling political party has always enjoyed a qualified majority since taking power in 1997. Both the opposition and factions within the ruling majority have often accused the Constitutional Court of politically motivated decisions. After the 2001 parliamentary elections, the OSCE/ODIHR criticized the court for inconsistent rulings that favored Socialist Party candidates in several contested electoral districts. The High Court has similarly not been free from allegations of political bias. The most recent case was the decision of the High Court to call on the Parliament to withdraw the immunity of Nikolle Lesi, an MP and owner of the daily newspaper Koha Jone, so that Lesi could be prosecuted in a case brought against him by the wife of the prime minister.

In an earlier ruling, the Tirana District Court imposed a fine of 2 million leke (about US$20,000) on Koha Jone after the prime minister sued the paper for libel. A number of local and international press watchdogs and media associations labeled the decision politically motivated and an attempt to curb media freedom. The daily Tema, which is very critical of government policies, has faced similar pressures.

Corruption (Score: 5.25)

In the realm of anticorruption initiatives, Albania's efforts since the fall of Communism appear, on paper, rather impressive. An October 2003 European Bank for Reconstruction and Development report found the Albanian legal framework to be among the most comprehensive in the region, and the country is a signatory to most of the international conventions against corruption. The government has set up a variety of structures and passed extensive legislation in the fight against corruption. A national strategy and an action plan have existed since 2000, with the action plan for 2003-2004 stressing the rule of law, prevention, and public participation. The Anticorruption Monitoring Group (ACMG)comprising heads of legal departments in relevant ministries as well as the minister of state, Marko Bello monitors the implementation of the strategy. A permanent secretariat to the ACMG provides administrative support and is responsible for the day-to-day implementation of the action plan. Every ministry has set up internal auditing controls. In addition, the State Audit Office performs regular auditing of public institutions. Legislation on conflict of interest is being prepared, while the Law on Declaration and Control of Assets was first implemented in 2004.

However, concrete results in the fight against corruption have lagged far behind, as laws have been either poorly implemented or not implemented at all. According to Transparency International's Corruption Perceptions Index, the rating for Albania in 2004 was 2.5 out of 10, where 10 indicates the lowest level of perceived corruption. This figure is unchanged from 2003. Five years after the Parliament passed the code on administrative procedures, which was supposed to enhance transparency in public administration operations, very little has changed in the way public administration works. The Law on Declaration and Control of Assets, an important legislative achievement, represented a positive development, but declarations of assets by some top state officials and their consequent verification served to heighten rather than lower popular perceptions of corruption. While several of the declarations revealed substantial assets (but not sources of income), no proper follow-up or verification took place, breeding skepticism and distrust about the whole process.

A number of other scandals during 2004 indicate that state capture by special interests seems to be on the rise. A draft law on digital broadcasting that could have facilitated a digital broadcasting monopoly was promoted aggressively in the Parliament by the very broadcasting company the law would have catered to; ultimately, the company was able to gather more than 70 (out of 140) signatures of MPs in a petition asking for the draft law to be voted on in a plenary session. However, in the plenary session the law was rejected owing to strong criticism by the OSCE that many of its provisions could allow for the creation of a monopoly in digital broadcasting. The media also alleged that procurement procedures had been violated in several tenders at the Ministry of Education and the Ministry of Public Transportation. The case that sparked the most interest among the public was an agreement between the Albanian government and an Italian company on building a waste management plant that would also have processed waste imported from Italy. A variety of civil society groups criticized the agreement, pointing to potential environmental harm, the violation of existing legislation, and a nontransparent bidding process. The government consequently suspended the agreement pending further investigation of the matter.

Administrative barriers to business and investment are high, including relative to neighboring countries another factor that stimulates higher corruption levels in public administration. According to the State Audit Office, in 2004 the misuse of public funds by state institutions and state-owned companies has increased from 2003 levels. While losses in 2003 by such misuse totaled US$29.5 million, the figure for only the first six months of 2004 was approximately US$30.7 million even though there were fewer audits in the first six months of 2004 than in the same period in 2003 (136 as opposed to 156).

The efficiency of anticorruption bodies has also often been called into question. Critics have said that the ACMG lacks the necessary governmental backing to be able to act as an effective coordinating unit. Despite the selection of contact points at each of the relevant ministries, most institutions do not collaborate in gathering and exchanging information. The State Audit Office has requested a larger number of disciplinary measures and sent more cases to the Office of the Prosecutor-General in 2004 than in 2003. Nevertheless, the number of prosecutions related to bribery and corruption still remains small (although higher than in 2003), and the Office of the Prosecutor-General frequently does not even investigate corruption charges. During the first six months of 2004, there were only 30 prosecutions related to bribery. Similarly, figures from the HCJ show that the number of disciplinary measures against judges was small in 2003 and did not change in 2004 despite the popular perception of the courts as one of the most corrupt institutions in the country.

Author

Blendi Kajsiu is executive director of the Albanian School of Politics and a part-time lecturer at the Department of Media and Communications, University of Tirana.