Home

Greece vs. Albania

Economy

GreeceAlbania
Economy - overview

Greece has a capitalist economy with a public sector accounting for about 40% of GDP and with per capita GDP about two-thirds that of the leading euro-zone economies. Tourism provides 18% of GDP. Immigrants make up nearly one-fifth of the work force, mainly in agricultural and unskilled jobs. Greece is a major beneficiary of EU aid, equal to about 3.3% of annual GDP.

The Greek economy averaged growth of about 4% per year between 2003 and 2007, but the economy went into recession in 2009 as a result of the world financial crisis, tightening credit conditions, and Athens' failure to address a growing budget deficit. By 2013, the economy had contracted 26%, compared with the pre-crisis level of 2007. Greece met the EU's Growth and Stability Pact budget deficit criterion of no more than 3% of GDP in 2007-08, but violated it in 2009, when the deficit reached 15% of GDP. Deteriorating public finances, inaccurate and misreported statistics, and consistent underperformance on reforms prompted major credit rating agencies to downgrade Greece's international debt rating in late 2009 and led the country into a financial crisis. Under intense pressure from the EU and international market participants, the government accepted a bailout program that called on Athens to cut government spending, decrease tax evasion, overhaul the civil-service, health-care, and pension systems, and reform the labor and product markets. Austerity measures reduced the deficit to 1.3% in 2017. Successive Greek governments, however, failed to push through many of the most unpopular reforms in the face of widespread political opposition, including from the country's powerful labor unions and the general public.

In April 2010, a leading credit agency assigned Greek debt its lowest possible credit rating, and in May 2010, the IMF and euro-zone governments provided Greece emergency short- and medium-term loans worth $147 billion so that the country could make debt repayments to creditors. Greece, however, struggled to meet the targets set by the EU and the IMF, especially after Eurostat - the EU's statistical office - revised upward Greece's deficit and debt numbers for 2009 and 2010. European leaders and the IMF agreed in October 2011 to provide Athens a second bailout package of $169 billion. The second deal called for holders of Greek government bonds to write down a significant portion of their holdings to try to alleviate Greece’s government debt burden. However, Greek banks, saddled with a significant portion of sovereign debt, were adversely affected by the write down and $60 billion of the second bailout package was set aside to ensure the banking system was adequately capitalized.

In 2014, the Greek economy began to turn the corner on the recession. Greece achieved three significant milestones: balancing the budget - not including debt repayments; issuing government debt in financial markets for the first time since 2010; and generating 0.7% GDP growth — the first economic expansion since 2007.

Despite the nascent recovery, widespread discontent with austerity measures helped propel the far-left Coalition of the Radical Left (SYRIZA) party into government in national legislative elections in January 2015. Between January and July 2015, frustrations grew between the SYRIZA-led government and Greece’s EU and IMF creditors over the implementation of bailout measures and disbursement of funds. The Greek government began running up significant arrears to suppliers, while Greek banks relied on emergency lending, and Greece’s future in the euro zone was called into question. To stave off a collapse of the banking system, Greece imposed capital controls in June 2015, then became the first developed nation to miss a loan payment to the IMF, rattling international financial markets. Unable to reach an agreement with creditors, Prime Minister Alexios TSIPRAS held a nationwide referendum on 5 July on whether to accept the terms of Greece’s bailout, campaigning for the ultimately successful "no" vote. The TSIPRAS government subsequently agreed, however, to a new $96 billion bailout in order to avert Greece’s exit from the monetary bloc. On 20 August 2015, Greece signed its third bailout, allowing it to cover significant debt payments to its EU and IMF creditors and to ensure the banking sector retained access to emergency liquidity. The TSIPRAS government — which retook office on 20 September 2015 after calling new elections in late August — successfully secured disbursal of two delayed tranches of bailout funds. Despite the economic turmoil, Greek GDP did not contract as sharply as feared, boosted in part by a strong tourist season.

In 2017, Greece saw improvements in GDP and unemployment. Unfinished economic reforms, a massive non-performing loan problem, and ongoing uncertainty regarding the political direction of the country hold the economy back. Some estimates put Greece’s black market at 20- to 25% of GDP, as more people have stopped reporting their income to avoid paying taxes that, in some cases, have risen to 70% of an individual’s gross income.

Albania, a formerly closed, centrally planned state, is a developing country with a modern open-market economy. Albania managed to weather the first waves of the global financial crisis but, the negative effects of the crisis caused a significant economic slowdown. Since 2014, Albania’s economy has steadily improved and economic growth reached 3.8% in 2017. However, close trade, remittance, and banking sector ties with Greece and Italy make Albania vulnerable to spillover effects of possible debt crises and weak growth in the euro zone.

Remittances, a significant catalyst for economic growth, declined from 12-15% of GDP before the 2008 financial crisis to 5.8% of GDP in 2015, mostly from Albanians residing in Greece and Italy. The agricultural sector, which accounts for more than 40% of employment but less than one quarter of GDP, is limited primarily to small family operations and subsistence farming, because of a lack of modern equipment, unclear property rights, and the prevalence of small, inefficient plots of land. Complex tax codes and licensing requirements, a weak judicial system, endemic corruption, poor enforcement of contracts and property issues, and antiquated infrastructure contribute to Albania's poor business environment making attracting foreign investment difficult. Since 2015, Albania has launched an ambitious program to increase tax compliance and bring more businesses into the formal economy. In July 2016, Albania passed constitutional amendments reforming the judicial system in order to strengthen the rule of law and to reduce deeply entrenched corruption.

Albania’s electricity supply is uneven despite upgraded transmission capacities with neighboring countries. However, the government has recently taken steps to stem non-technical losses and has begun to upgrade the distribution grid. Better enforcement of electricity contracts has improved the financial viability of the sector, decreasing its reliance on budget support. Also, with help from international donors, the government is taking steps to improve the poor road and rail networks, a long standing barrier to sustained economic growth.

Inward foreign direct investment has increased significantly in recent years as the government has embarked on an ambitious program to improve the business climate through fiscal and legislative reforms. The government is focused on the simplification of licensing requirements and tax codes, and it entered into a new arrangement with the IMF for additional financial and technical support. Albania’s three-year IMF program, an extended fund facility arrangement, was successfully concluded in February 2017. The Albanian Government has strengthened tax collection amid moderate public wage and pension increases in an effort to reduce its budget deficit. The country continues to face high public debt, exceeding its former statutory limit of 60% of GDP in 2013 and reaching 72% in 2016.

GDP (purchasing power parity)$319.334 billion (2019 est.)

$313.469 billion (2018 est.)

$307.521 billion (2017 est.)

note: data are in 2010 dollars
$39.859 billion (2019 est.)

$38.986 billion (2018 est.)

$37.461 billion (2017 est.)

note: data are in 2010 dollars
GDP - real growth rate1.87% (2019 est.)

1.91% (2018 est.)

1.44% (2017 est.)
2.24% (2019 est.)

4.07% (2018 est.)

3.8% (2017 est.)
GDP - per capita (PPP)$29,799 (2019 est.)

$29,206 (2018 est.)

$28,594 (2017 est.)

note: data are in 2010 dollars
$13,965 (2019 est.)

$13,601 (2018 est.)

$13,037 (2017 est.)

note: data are in 2010 dollars
GDP - composition by sectoragriculture: 4.1% (2017 est.)

industry: 16.9% (2017 est.)

services: 79.1% (2017 est.)
agriculture: 21.7% (2017 est.)

industry: 24.2% (2017 est.)

services: 54.1% (2017 est.)
Population below poverty line17.9% (2018 est.)14.3% (2012 est.)
Household income or consumption by percentage sharelowest 10%: 1.7%

highest 10%: 26.7% (2015 est.)
lowest 10%: 4.1%

highest 10%: 19.6% (2015 est.)
Inflation rate (consumer prices)0.2% (2019 est.)

0.6% (2018 est.)

1.1% (2017 est.)
1.4% (2019 est.)

2% (2018 est.)

1.9% (2017 est.)
Labor force4 million (2020 est.)1.104 million (2020 est.)
Labor force - by occupationagriculture: 12.6%

industry: 15%

services: 72.4% (30 October 2015 est.)
agriculture: 41.4%

industry: 18.3%

services: 40.3% (2017 est.)
Unemployment rate17.3% (2019 est.)

19.34% (2018 est.)
5.83% (2019 est.)

6.32% (2018 est.)

note: these official rates may not include those working at near-subsistence farming
Distribution of family income - Gini index34.4 (2017 est.)

35.7 (2011)
33.2 (2017 est.)

30 (2008 est.)
Budgetrevenues: 97.99 billion (2017 est.)

expenditures: 96.35 billion (2017 est.)
revenues: 3.614 billion (2017 est.)

expenditures: 3.874 billion (2017 est.)
Industriestourism, food and tobacco processing, textiles, chemicals, metal products; mining, petroleumfood; footwear, apparel and clothing; lumber, oil, cement, chemicals, mining, basic metals, hydropower
Industrial production growth rate3.5% (2017 est.)6.8% (2017 est.)
Agriculture - productsmaize, olives, wheat, milk, peaches/nectarines, oranges, tomatoes, grapes, milk, potatoesmilk, maize, tomatoes, potatoes, watermelons, wheat, grapes, cucumbers, onions, apples
Exports$92.925 billion (2019 est.)

$88.511 billion (2018 est.)

$81.196 billion (2017 est.)
$900.7 million (2017 est.)

$789.1 million (2016 est.)
Exports - commoditiesrefined petroleum, packaged medicines, aluminum plating, computers, cotton (2019)leather footwear and parts, crude petroleum, iron alloys, clothing, electricity, perfumes (2019)
Exports - partnersItaly 10%, Germany 7%, Turkey 5%, Cyprus 5%, Bulgaria 5% (2019)Italy 45%, Spain 8%, Germany 6%, Greece 5%, France 4%, China 4% (2019)
Imports$94.597 billion (2019 est.)

$91.798 billion (2018 est.)

$85.092 billion (2017 est.)
$4.103 billion (2017 est.)

$3.67 billion (2016 est.)
Imports - commoditiescrude petroleum, refined petroleum, packaged medicines, cars, ships (2019)refined petroleum, cars, tanned hides, packaged medical supplies, footwear parts (2019)
Imports - partnersGermany 11%, China 9%, Italy 8%, Iraq 7%, Russia 6%, Netherlands 5% (2019)Italy 28%, Greece 12%, China 11%, Turkey 9%, Germany 5% (2019)
Debt - external$484.888 billion (2019 est.)

$478.646 billion (2018 est.)
$9.311 billion (2019 est.)

$9.547 billion (2018 est.)
Exchange rateseuros (EUR) per US dollar -

0.82771 (2020 est.)

0.90338 (2019 est.)

0.87789 (2018 est.)

0.885 (2014 est.)

0.7634 (2013 est.)
leke (ALL) per US dollar -

102.43 (2020 est.)

111.36 (2019 est.)

108.57 (2018 est.)

125.96 (2014 est.)

105.48 (2013 est.)
Fiscal yearcalendar yearcalendar year
Public debt181.8% of GDP (2017 est.)

183.5% of GDP (2016 est.)
71.8% of GDP (2017 est.)

73.2% of GDP (2016 est.)
Reserves of foreign exchange and gold$7.807 billion (31 December 2017 est.)

$6.026 billion (31 December 2015 est.)
$3.59 billion (31 December 2017 est.)

$3.109 billion (31 December 2016 est.)
Current Account Balance-$3.114 billion (2019 est.)

-$6.245 billion (2018 est.)
-$908 million (2017 est.)

-$899 million (2016 est.)
GDP (official exchange rate)$209.79 billion (2019 est.)$15.273 billion (2019 est.)
Taxes and other revenues48.8% (of GDP) (2017 est.)27.6% (of GDP) (2017 est.)
Budget surplus (+) or deficit (-)0.8% (of GDP) (2017 est.)-2% (of GDP) (2017 est.)
Unemployment, youth ages 15-24total: 35.2%

male: 33.5%

female: 37.2% (2019 est.)
total: 27%

male: 27.8%

female: 25.9% (2019 est.)
GDP - composition, by end usehousehold consumption: 69.6% (2017 est.)

government consumption: 20.1% (2017 est.)

investment in fixed capital: 12.5% (2017 est.)

investment in inventories: -1% (2017 est.)

exports of goods and services: 33.4% (2017 est.)

imports of goods and services: -34.7% (2017 est.)
household consumption: 78.1% (2017 est.)

government consumption: 11.5% (2017 est.)

investment in fixed capital: 25.2% (2017 est.)

investment in inventories: 0.2% (2017 est.)

exports of goods and services: 31.5% (2017 est.)

imports of goods and services: -46.6% (2017 est.)
Gross national saving9.9% of GDP (2019 est.)

8.8% of GDP (2018 est.)

8.9% of GDP (2017 est.)
14% of GDP (2019 est.)

16.8% of GDP (2018 est.)

16.5% of GDP (2017 est.)

Source: CIA Factbook