|Albania Table of Contents
After more than a decade of autarky and trade surpluses, the force of Albania's economic collapse pulled the country's foreign-trade balance and balance of payments into the red. Albania's exports slipped more than 50 percent to about US$120 million in the early 1990s, and the influx of emergency food and commodity aid contributed almost half of a 20-percent increase in imports. In 1991 Albania's external current-accounts deficit, excluding official transfers, widened to more than US$250 million, which equaled about 30 percent of the country's GDP before the economy seized up. In an effort to narrow the gap, the authorities practically depleted Albania's meager foreign-currency reserves. In the late 1980s, the government began ignoring the constitutional ban on foreign credits, and by mid-1991 the country's total convertible-currency debt was soaring toward US$400 million. Shortfalls in the output of electric power, minerals, and other goods set off another significant slide in export earnings. Officials hoped remittances from the thousands of Albanians who had fled to Greece and Italy would help return Albania's balance of payments to an even keel, but in the early 1990s these émigrés were mostly sending home hard goods, such as used cars, unavailable in the homeland.
Source: U.S. Library of Congress