Albania’s Unsuccessful Attempts to Rapidly Develop the Industrial Sector (1920–1990)

During the period 1920–1990, Albania experienced two political regimes that differed greatly in ideological and socio-economic attitudes, as well as in the form of government and geopolitical situation. In the first period (1920–1939) Albania was under an autocratic regime that nevertheless allowed relative freedom of speech and a free market, the other was a communist dictatorship (1944–1991) that implemented a centralized and planned economy, and brutally suppressed basic human rights. Surprisingly, both regimes implemented the same plan to rapidly modernize and industrialize the most backward country in Europe. It may seem utopian, driven by miscalculations or ideology, for a tiny and backward country like Albania to embark on a rapid industrialization program. However, the existence of abundant mineral resources (chrome, copper, iron, oil, and natural gas) and a potentially large amount of hydroelectric power generation capacity were factors that could justify the choices made by both political regimes. In the first case, Albania’s vulnerability to foreign financing made its economy increasingly dependent on Fascist Italy and eventually led to the country’s occupation. While in the case of the communist regime, the dogmatic policy led the country’s economy to autarky and collapse. Today, Albania has another chance to gradually develop a normal and balanced economy with the perspective of EU integration.