Slovenia-Albania: An Economic Bridge

CELJE — At the MOS fair, the business forum Slovenia-Albania: An Economic Bridge highlighted opportunities to strengthen economic cooperation, particularly in the wood-processing industry. NLB is also preparing to enter the Albanian market, with plans to establish a representative office. Chairman of the management board Blaž Brodnjak announced that NLB would seriously consider any opportunity to acquire a bank, should one arise in the coming months. The forum was co-organised by the Institute for Strategic Solutions (ISR), the public agency SPIRIT Slovenia, the Albanian Investment Development Agency (AIDA) and Celje Fair, with the support of NLB.

The forum was opened by ISR Director Tine Kračun and Celje Fair CEO Nina Ermenc Pangerl. "Now is the best time to build a bridge: the road between Ljubljana and Tirana is wide open," Kračun said. Despite Slovenian exports growing at roughly 14 per cent annually over the past five years, Albania remains Slovenia's smallest trading partner in the Western Balkans. Last year's exports reached €94.7 million, and Kračun sees further opportunities as Albania's EU accession process reduces regulatory uncertainty.

Leon Korošec, State Secretary at the Ministry of the Economy, Labour and Sport, pointed to opportunities in sustainable tourism, water and waste management, agriculture, insurance and banking. "We see potential for joint projects and long-term partnerships in these areas," he said. Albanian Ambassador to Slovenia Oljan Kanushi called for linking Slovenian expertise with Albanian demand, particularly in wood processing and construction. He encouraged firms to explore joint production, subcontracting and the exchange of technology and know-how in order to become part of the same supply chain.

NLB would seriously consider a bank acquisition

NLB Chairman Blaž Brodnjak noted that NLB is among the three largest lenders in five Western Balkan markets, where economies, like Slovenia's, are largely financed by banks. "Banks are the backbone of the economy, and that is also how we are coming to Albania," he said. NLB has directed its analytical capacity towards the Albanian market, which it wants to understand better, and is preparing to establish a representative office to explore financing opportunities for Albanian companies. "If an opportunity to acquire a bank arises in the coming months, we will certainly take it very seriously," he said.

Brodnjak argued that further delay of EU enlargement can no longer be justified. "There is no safe Europe without the Western Balkans inside the EU," he said. South-eastern Europe has the best prospects of any European region, with growth of 3.5 to 4 per cent forecast as accession approaches. Slovenians know the region better than anyone, he said, and there are opportunities for cooperation with banks across all sectors seeking to grow. "We needed a direct daily flight between Ljubljana and Tirana yesterday."

Now is the best time to build a bridge: the road between Ljubljana and Tirana is wide open.

Tine Kračun, Director of the Institute for Strategic Solutions (ISR)

Wood, wood, wood: and more wood

"In February this year, SPIRIT Slovenia and AIDA signed a memorandum of understanding in Tirana. One of the first concrete results is AIDA's participation and the Albanian business delegation's presence in Celje today, with Albania as the MOS partner country," said Nataša Kos, Deputy Director of SPIRIT Slovenia. Slovenian exports to Albania consist mainly of pharmaceuticals, foodstuffs, electrical machinery and vehicles. Services trade rose by 9 per cent last year to €25 million. Kos highlighted opportunities in wood processing, and Laura Saro, Executive Director of AIDA, presented the sector's potential. Albania's wood-processing industry comprises around 1,000 companies employing approximately 7,500 people. Imports of wood and wood products rose from €304.7 million to €349.3 million last year, while exports grew from €52 million to €66 million. AIDA sees rising imports as evidence of growing domestic demand for wood raw materials and equipment.

Saro highlighted the TEDA Ital Druri industrial zone in Elbasan, dedicated to wood processing and the furniture industry, which offers VAT and customs exemptions as well as lower corporate income tax. "TEDA Ital Druri combines a strategic location, purpose-built industrial infrastructure and a competitive package of tax incentives," she said. She expressed hope that Slovenia would rank among Albania's top five trading partners as early as next year. Slovenia currently ranks 21st among countries from which Albania imports and 20th among its export markets. Bilateral trade in wood and wood products reached €1.1 million last year.

Albania's construction boom is Slovenia's opportunity

At a roundtable on investment potential in the wood-processing industry, Dr Gal Kušar of the Slovenian Forestry Institute noted that Slovenian forests could sustainably yield 7.1 million cubic metres of timber each year, yet only about 5.4 million cubic metres are actually harvested. Some 77 per cent of forests are privately owned, yet forestry is not a significant source of income for most owners, and younger generations often do not even know where their forests are. Some people believe that not managing a forest is the best way to protect it. "Slovenia has a long tradition of sustainable forest management, so we must mobilise this untapped potential," he said. Jaka Hrovat, Director of Mizarstvo Hrovat-Lesena vrtna oprema, showed how timber can be turned into higher-value products: his company has been making modular houses for 62 years and is now focusing on small wooden homes for simple living in nature.

Demand for such products is growing in Albania. Julinda Kllapi, head of the Albanian wood cluster, said most of it comes from construction and tourism. "All these new buildings, hotels and tourist facilities will need furniture," she said. According to Albania's statistical office, furniture production has risen and investment in technology has doubled as companies respond to growing demand. Ina Vejsu, a lecturer at the Faculty of Forestry of the Agricultural University of Tirana, warned that the construction boom in tourism and beyond must become more sustainable. The faculty is therefore training students in sustainable approaches and new technologies and directing them towards the wood industry, which needs specialists ranging from engineers to designers. Bernard Likar, Director of the Slovenian Wood Cluster, added that good business starts with finding the right partners, and Albania, he said, is no different from any other market.