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Italy-Albania -- June 5 - 9, 2002
Philip Martin, Susan Martin, and Ferruccio Pastore
July 14, 2002
Albanian Migration........................................................................................................................................ 3
Italy and Migration from Albania....................................................................................................... 3
Cooperation in Managing Migration From and Through Albania................................. 4
Develop or Emigrate?.................................................................................................................................... 5
The Cooperative Efforts to Manage Emigration (CEME) project examines ways in which countries of origin, transit, and destination can work together to coordinate migration movements and reduce emigration pressures. The project focuses on source countries of migration that are in transition to market economies and democratic systems of governance, developments that promise to reduce unauthorized migration. CEME organizes site visits to seek best practices for:
Â· spurring economic development, democratization and respect for human rights in migrant areas of origin;
Â· developing cooperative efforts to use the three R's associated with migration flows—recruitment, remittances, and returns—to help to reduce emigration pressures; and
Â· promoting ongoing cooperation on migration matters between countries of origin, transit and destination.
The CEME site visit to Italy and Albania â€“ organized in cooperation with the Centro Studi di Politica Internazionale (CeSPI), an Italian independent research institute - took place in June 2002. Albania is a country of 3.1 million people with a GDP of $4.1 billion that (1) switched in the early 1990s, after 45 years of Communism, from economic autarky to a peculiar form of market economy and (2) experienced some of the world's highest emigration rates in the 1990s—some 600,000 to 700,000 Albanians, or almost 1/4 of Albanians, and 1/2 of Albanian professionals, emigrated. As a result, the labor force is only 38 percent of the population, versus 50 percent in most industrial countries (UNDP, 1996, 2000).
The major destinations of Albanian migrants in the 1990s were Greece, which had 400,000 to 600,000 Albanians in 2002, and Italy, which had 144,000 legal residents and probably some tens of thousands illegals at the end of 2001 Many Albanians have become legal residents of Greece and Italy as a result of regularization-legalization programs. Albania is also a transit point for third country nationals attempting to reach the rest of Europe via Albania. Of particular interest to the CEME members were efforts by the Italian and Albanian governments to cooperate in managing the flows of Albanian and transit migrants.
In June 2002, when the CEME visit was made, Albania was experiencing rapid although unbalanced economic growth as a result of $615 million in remittances from Albanians abroad (estimates: Bank of Albania, Annual Report 2001) as well as aid from the European Union (EU) and other sources. The spending of remittances and aid has fueled a building boom, but there was no clear sense of how Albania would use the window of opportunity opened by remittances and aid to develop a viable economy. The optimistic scenario is that remittances and investments from Albanians abroad will produce an economic take off based on value-added food production and tourism in the "Switzerland of the Balkans." The pessimistic scenario is that corruption and divided government will prevent the development of a successful economic strategy, and that low wages, high unemployment, and inadequate services such as health care and education will prompt the continued emigration of young and educated Albanians.
Potential best practices included:
Â· Joint Italian-Albanian marine patrols to discourage smuggling and trafficking in small "fast boats."
Â· Italy granting Albania at least 6,000 work visas a year, to publicize the fact that there is a legal way to work in Italy, helping to discourage illegal migration.
Â· Bilateral and international assistance to enable Albania to develop laws and institutions to deal with foreigners transiting Albania, and foreigners requesting asylum in Albania.
Albania does not, on the other hand, appear to be a best practice in managing the use of remittances to aid economic development. Although remittances play an important role in basic subsistence and construction of housing, there have been fewer efforts to encourage investment of these funds in infrastructure or productive activities. The banking system needs substantial reform to become a venue for transfer of remittances and source of credit for enterprise development. Albania would benefit from a more systematic examination of the lessons learned in other countries about the investment of remittances for economic development.
Albania: History, Politics and Economics
Albania became an independent nation on November 28, 1912. When Albania's present borders were fixed in 1921, about one-third of Albanians were outside the country, mostly in Kosovo. Enver Hoxha led the communist resistance to the occupying Axis powers during World War II, and his Albanian Workers' Party ruled Albania between 1946 and 1985. Hoxha first allied Albania with Stalin to offset the efforts of Tito's Yugoslavia to include Albania, then switched to China as chief supporter, and finally led Albania into ever-deeper isolation. Albania is physically isolated by mountains from its neighbors: Kosovo and Serbia to the north, Macedonia to the east, and Greece to the south-east, which â€“ associated with the strong cultural and psychological impact of Italian TV â€“ helps to explain why many Albanians look across the Adriatic to Italy.
After Hoxha's death in 1985, Albania began to liberalize, but too slowly for students and others, whose protests led to the downfall of communism in 1990. However, in March 1991 elections, the AWP, renamed the Socialist Party of Albania, took power and denounced Hoxha's isolationist rule. Hope for quick economic improvement was dashed by political squabbling, leading to mass emigration. In March 1991 Italy accepted a first group of 23,000 Albanian migrants; in August another group of 20,000 people was treated in the opposite way and repatriated without exceptions. In the same period around 30,000 migrants arrived to Greece. In March 1992, the opposition Democratic Party of Albania came to power and generated some initial optimism, but in the long run, it produced more economic chaos, a breakdown of law and order, and more emigration.
Between 1992 and 1995, there was an economic recovery and rising imports of consumer goods to which Albanians were obtaining access for the first time; many families' incomes came from remittances and smuggling goods and fuel into Yugoslavia during UN sanctions. However, near the end of 1996, a new wave of political instability was created by the collapse of "pyramid" or Ponzi investment schemes, in which unregulated institutions accepted deposits, and paid high interest rates to early investors with deposits made by later investors. When the scheme collapsed, there was rioting, including looting of military arsenals, and mass emigration in early 1997, as many people lost their life savings and crime rose sharply. Also thanks to an Italy-led multinational mission (Mission "Alba") order was restored and emigration slowed; later on, joint Italian-Albanian patrols (Missione di Polizia Interforze) contributed to the reduction of the number of migrants. The numbers detected as they arrived in Italy reduced from a peak of 46,000 in 1999 to 7,500 in 2001.
In subsequent elections, the SPA returned to power, and has been the dominant political party in the past five years.  However, there was a dispute between the dominant SPA leaders in 2001-02, and the opposition DPA refused to take seats in Parliament to protest what it said were unfair elections, continuing a pattern of unstable politics. There is an important north-south divide in Albania with political consequences. The Geg highlanders in the north, who are closely related to the ethnic Albanians of Kosovo, have relatively poor land and a more tribal, traditional culture. The Tosks in the south developed a village-based in coastal areas, and were more open to the outside world. The Northern regions have long been the largest, although certainly not the only emigration basin.
Albania's most important bilateral relationships are with Italy and Greece; they are its leading trade partners, and places with large numbers of Albanian migrants. On the regional and international level, Albania has benefited from its cooperation during the NATO's air war against Yugoslavia (Serbia-Montenegro) in March-June 1999. The EU, the US and Russia in June 1999 launched a Stability Pact for Southeastern Europe with three "working tables": democratization and human rights; economic reconstruction, development and co-operation; and security—including a special emphasis placed on migration and asylum.
Corruption remains a problem, with police, customs, prosecutors and judges accused of being susceptible to bribes. Italy has taken the lead in equipping and retraining Albanian police. There has been an attempt to make continued EU aid contingent on reduced crime and corruption. The EU is committed to turning Albania into a crossroads for the Balkans, with highway Corridor 8 running east-west from Durres to Macedonia, and Corridor 4 running from north-south from Montenegro to Greece. Albania hopes to join both the EU and NATO, and the EU and the US are involved in Albania's development. In 1999, the EU launched a new Stabilization and Association Process (SAP) with five South-Eastern European countries, including Albania, and it has provided Albania with about $900 million in assistance between 1991 and 2001. The US is building defense facilities in Albania, aiming to prevent Albania from becoming a Balkans base for Islamic terrorism.
The effort to achieve a self-sufficient economy for four million people in a small and mountainous country left Albania further behind most other transition economies in the 1990s. The first signs were positive, as privatized agriculture in the early 1990s increased its output to compensate for the collapse of state industry. However, the gains from agriculture soon stalled, and emigration and remittances have accompanied slow and partial privatization as an engine of growth (World Bank, 2000).
Agriculture is the most important economic sector, accounting for 50-55 percent of GDP, but it remains backward—animal power is still used to plough about one-third of the land. Albania opened to the world in 1990-91, when its industry was based on antiquated Soviet and Chinese machinery, much of which was looted during unrest in 1991-92 and 1997-98, so that manufacturing contributes only 12 percent of GDP. Many of the most promising enterprises operating today are joint ventures with foreign firms in forestry and furniture, or assembly of footwear and garment operations based on low Albanian wages. Construction is 15 percent of GDP, as remittances fuel house building, both to house rural-urban migrants around major cities, and to build new or remodel the homes of migrants and their relatives. Typical Albanian wages are $100 a month, and employers and employees contribute an additional 34 percent of wages for healthcare and social insurance.
Almost 60 percent of Albanians live in rural areas, and the rural areas have the worst poverty. About two-thirds of school age children are in rural areas, and a combination of poor schools, emigrating teachers, and pressure to work on now private farms has led to declining school attendance. Tirana University, which admits about one-third of university students, reports that about half of its graduates emigrate. The Albanian government's Strategy for Economic and Social Development estimates that 60 percent of residents are poor, defined as an income of US$4.30 or less (at 1995 purchasing power parity) per person per day. (Economist Intelligence Unit, 2001)
Remittances and aid explain why Albania can sustain a large trade deficit: exports were $300 million in 2001, imports were $1.2 billion, and the trade deficit financed in part by remittances from Albanians abroad. According to a survey cited by one respondent, 44 percent of Albanians deliver remittances personally, 36 percent entrust them to friends, and 19 percent remit via banks.
Recently, movements to the more traditional immigration countries of the United States and Canada have increased, particularly of higher skilled migrants. In fact, Albanian respondents referred to the "Canadian phenomenon" when discussing the issue of brain drain, in reference to Albanians admitted under the Canadian point system for their educational and other skills. Most Albanians who obtain permanent residence in the United States enter through the Diversity Program, a lottery open to residents of countries with relatively low levels of admission to the United States.
Albania has also become a country of refuge and transit. In 1999, during the NATO intervention in Kosovo, some 450,000 ethnic Albanian Kosovars fled to Albania, and were largely welcomed by Albanians. Their presence had mixed short-and medium-term effects. On the one hand, international aid arrived to help care for the Kosovars, and aid has continued to flow since. On the other hand, the presence of Kosovars depressed wages and encouraged some Albanians to emigrate or to move from the poorer northeastern regions bordering Kosovo to Tirana and other urban areas. Almost all of the Kosovar refugees returned home after the cessation of conflict, but Albania has since seen the arrival of migrants from the Middle East and South Asia, in particular, who are transiting Albania in the hopes of reaching Europe.
Italy and Migration from Albania
The new Italian law increases patrols of Italy's coastlines and requires non-EU citizens to be fingerprinted in order to remain in Italy. Residence permits are to be linked to work permits, so that non-EU foreigners without jobs would have to leave within six months, down from 12 months—some 15,000 non-EU foreigners were admitted to Italy to seek jobs in 2001. Italian employers sponsoring foreign workers have to ensure housing, and also provide a bond to cover the cost of removing the worker if necessary.
The new law increases the power of the Ministry of Interior and decreases the power of the Ministry of Labor to manage non-EU foreign workers. Work permits for non-EU foreigners are to be reduced from a maximum of four to a maximum of two years, and requests for renewals must be made 90 days in advance, up from 30 days. In order to become a permanent resident, non-EU foreigners must live six years in Italy, up from five years, so that two renewals are necessary for immigrant status. When leaving Italy, non-EU foreigners will no longer be able to claim immediate refunds of the social security taxes they paid to the pension agency, INPS—pension contributions are 25 to 30 percent of gross wages (Pastore and Sciortino, 2001).
In 2000 and 2001, Italy established quotas for foreigners from particular countries to reward them for cooperation to reduce smuggling, and to provide legal channels for migrant arrivals, e.g. the 2001 quotas were for 6,000 Albanians, 3000 Tunisians, and 1,500 Moroccans. The quotas for 2002 have not yet been announced although respondents expected they would be after the new law is enacted.
Under the new law, bars to legal re-entry are increased. After being detected in Italy, non-EU foreigners are barred from legal entry for 10 years, up from the current five years. Penalties for re-entering Italy illegally are increased, with 6-12 months of detention for a first illegal re-entry, and then 1-4 years in prison for subsequent re-entries. Illegal migrants can be detained 60 days before removal, up from the current 30 days, and foreigners who apply for asylum after being detained are to remain in detention.
About 10 percent of the foreigners in Italy, 150,000 to 200,000, are Albanians, most having arrived in the 1990s. There is an apparent paradox with Albanian migration to Italy: Italian-Albanian government relations are described as the best ever, reflecting Italian-Albanian cooperation to prevent smuggling and trafficking; in spite of this, the anti-Albanian prejudice has grown steadily, fuelled by the concentration of the media on a marginal but quite visible criminal minority. There were two major waves of Albanian migrants to Italy, and their reception was very different. The Albanians arriving in 1991, after the fall of Communism, were initially welcomed; those arriving in 1997, after the collapse of the pyramid investment schemes, were not.
Albanian migration to Italy seems to have reached an equilibrium level, which raises the question--what would happen if current requirements that Albanians have visas to enter Italy were dropped, as has the EU has done for Bulgaria and Romania? Even were Italy able to drop visa requirements unilaterally (which is impossible under the Schengen Agreement), the government would not be inclined to take that step. Noting that 60-70 percent of Albanian requests for visas are rejected in Tirana (around 40,000 visas were issued by Italy's three consulates in Albania in 2001). Government officials also point out that despite a drop in unauthorized Albanian migration, there are still about 5,000 unauthorized Albanians a month apprehended in Italy (Silj, 1997; Ministero degli Affari Esteri, 2000, 2001). Italy allows unaccompanied minors to remain until they are 18, and there appears to be a surge of under-18 unaccompanied minors arriving in Italy. There are also lingering doubts about the commitment of the Albanian government to ending smuggling operations.
Cooperation in Managing Migration From and Through Albania
Much of this bilateral cooperation is now focused on the problem of transit migration, rather than stopping illegal Albanian migration (ICMPD, 2000; Council of the European Union, 2000). By some estimates, 80 percent of the migrants leaving Albania for Italy are not Albanians. Much of the anti-trafficking activities discussed above are now focused on third country nationals.
The Italian-Albanian cooperation on migration enforcement has undergone a shift during the past year. Initially, the focus was on training and technical assistance. More recently, the Italian presence has been reduced, but the new cooperation takes the form of joint operations against smugglers. The need for action against smuggling is evident. All respondents agreed that the smuggling operations were ruthless, putting migrants at high risk. For example, smugglers may have several boats on route to Italy when spotted; they are likely to push the migrants overboard as a diversion in order to escape with more valuable drug shipments.
Even though the enforcement efforts are now focused primarily on transit migration, all respondents agreed that there was need for additional legal channels through which Albanians in search of employment could find jobs. At the request of the Italian government, the IOM operates a Migrant Assistance Center in Tirana whose goal is to provide Albanians considering emigration with information and advice about jobs abroad. Italy reserved 6,000 slots for Albanians in 2000 and 2001. Since 2000, some 54,000 Albanians wrote to IOM-MAC for information, 34,000 completed applications to work abroad, 17,000 were interviewed by MAC staff to assess their Italian language work skills, and 2,000 were sent to Italy, with half reporting that they found jobs during their one-year stays in Italy. The original aim of this $300,000, two-year project was to have Albanian job seekers vetted by MAC, and to have Italian employers view Albanian job seekers on line (International Organization for Migration, 2000). However, most Italian employers prefer to request workers by name, suggesting that the Albanian workers requested are known to the employer or recommended by a current Albanian employee, not IOM-MAC.
Albanian migration crises as well as the arrival of refugees from neighboring Kosovo mean that both the International Organization for Migration and the UN High Commissioner for Refugees are present. Their mission has evolved, from dealing with irregular Albanian migration to more recently dealing with the transit of non-Albanians through Albania. The international organizations are also helping the Albanian government to draft its own legislation for handling the arrival of asylum seekers and other migrants.
With the help of international organizations, Albania is developing governmental capacity to deal with foreigners seeking asylum. The Albanian government signed the 1951 Geneva Convention in 1992, and began developing the appropriate domestic law and institutions with the aim of having asylum laws that would speed integration into the EU. As with other aspects of Albania, the law on the books seems adequate, but there are many gaps in practice. For example, a 2000 report based on trips to various border police posts found information on detained foreigners mostly entered into logs by hand and no budgets for food or shelter for detained persons.
Foreigners apprehended or detained inside Albania are "pre-screened" by representatives of international organizations to determine if they are trafficked, are potential refugees, or are voluntary economic migrants. Police are to notify the pre-screening team when they detain a foreigner who may be trafficked or a refugee, and the team is to arrive within 24 hours to interview the foreigner. Between March 2001 and March 2002, some 367 foreigners, mostly Kurds, were referred to pre-screeners, 93 requested asylum in Albania, and 7 were granted asylum in Albania—another 72 left Albania voluntarily or disappeared from the shelter.
The CEME team heard varied views as to the overall effectiveness of these efforts at international and bilateral cooperation in managing migration. Both Italian and Albanian police officials expressed satisfaction with the cooperation, but they also voiced concern that the reduction in Italian forces would impede some of their efforts to interdict and apprehend the smugglers. Of equal concern is the failure of the Italian government to announce this year's quota of labor visas for Albanians. Respondents noted that part of the unofficial quid-pro-quo—cooperation on enforcement in exchange for work visas and other assistance—was now missing. One knowledgeable respondent questioned whether the Albanian authorities have indeed made a long-term commitment to stopping the lucrative traffic in humans and drugs, pointing out that some of the police trained in marine interception were quickly relocated to patrolling land borders. Unless work visas or other incentives are provided, there would be little reason for the Albanian authorities to continue working with Italian police officials to control these movements.
Develop or Emigrate?
The 1990s did not produce the political stability needed for investment in Albania, either of remittances or Foreign Direct Investment (FDI). Furthermore, the 1997 collapse of the pyramid investment schemes has made many Albanians leery of banks. This reluctance to use official banks affects the transfer of remittances; less than 20 percent of Albanian remittances are believed to be transferred via banks. The absence of credible banking institutions also affects the ability of entrepreneurs to obtain credit for new economic activities (Albania. Status/Progress Report, 2001; Sokoli and Axhemi, 2000).
Respondents differed in their views regarding the current and longer-term impact of remittances on economic development. As in many countries, experts do not necessarily trust the official statistics on remittance flows, leading to some disagreement about the amounts transferred. Those who view remittances negatively point out that they are used primarily for consumption, particularly of food imported from other European countries, and hence do little to stimulate growth in agriculture or other business activities. Others counter that remittances have promoted a great deal of construction as well, providing jobs and economic stimulus. Members of the CEME team also noted that increased access to food was itself a contribution to development; well-fed children are more likely to do well in school, helping with long-term economic growth.
Most respondents agreed, though, that more could be done to encourage investment of remittances in productive, job-producing activities. Some Albanians project declining remittances as Albanians integrate abroad, which adds an aura of urgency to the quest for efforts to turn remittances into investments that can accelerate development. Emigration pressure remains significant, even though Albanians are now far more realistic about opportunities abroad—a January-February 2002 poll found that 42 percent of young Albanians would emigrate if they could. Albanian experts did not appear familiar with the efforts of other countries to increase the development-payoff of remittances, even though some of this experience would be useful.
Albania does not, on the other hand, appear to be a best practice in managing the use of remittances to aid economic development. Although remittances play an important role in basic subsistence and construction of housing, and may indirectly facilitate development, there have been fewer efforts to encourage investment of these funds in productive activities. The banking system needs substantial reform to become a venue for transfer of remittances and source of credit for enterprise development. Albania would benefit from a more systematic examination of the lessons learned in other countries about the investment of remittances for economic development.
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