Trade Partners

Trade Partners

In the mid-1980s, Albania claimed to be carrying on trade with more than fifty countries although the value of the goods exchanged with most of them was small. Trade with IMF member countries, however, was in some cases substantial (see Table 11, Appendix). Neighboring Yugoslavia accounted for about 18 percent of Albania's trade volume; the remainder was divided almost evenly between the communist and capitalist countries. Tiranė's main trading partners in Eastern Europe were Romania, Poland, Bulgaria, and Czechoslovakia. In the late 1970s, Albanian's break with China forced its commercial representatives to redouble their efforts to find new trading partners in the free-market world. The value of Albania's trade with the West stood at about US$200 million by the late 1980s. In 1988 its main Western trading partners were Italy (US$65 million in trade turnover), West Germany (US$52 million), Greece (US$16.4 million), and France (US$14 million).

Albanian-Yugoslav trade, torpid throughout a decades-long chill in the two countries' relations, revived after Albania's break with China. The chamber of commerce of each nation opened offices in the other's capital city, and in 1986 a new rail line to Yugoslavia linked Albania with the European rail network for the first time. Albanian imports from Yugoslavia included reinforcing steel, railroad track, steel piping, cables, bricks, pharmaceuticals, electronics, textiles, food, and capital goods. Yugoslavia imported electric power, tobacco, chrome, bitumen, gasoline, natural gas, cognac, and food from Albania. The fallout from the political crisis in Yugoslavia's Kosovo province, populated mainly by ethnic Albanians, had surprisingly little effect on Albanian-Yugoslav trade until the early 1990s, when war erupted between Croatia and Serbia. In 1991 the Albanian government and leaders of the ethnic Albanian community in Kosovo worked toward establishing a joint, Tiranė-based commission to promote stronger economic ties.

After its break with the Soviet Union in 1960, Albania played no part in the activities of Comecon. Trade with the Eastern bloc nations--with the glaring exception of the Soviet Union, with which Albania maintained no trade relations--increased after Albania broke with China. Generally, Albania supplied its communist-world trading partners with metal ores and agricultural products; it imported machinery, transportation equipment, and some consumer goods. The Albanians obtained rolled steel and coking coal from Poland, pumps from Hungary, trucks and tires from Czechoslovakia, sheet steel from Bulgaria, and textile machinery and fertilizers from East Germany. The Albanians also signed a contract with Hungary to build a pharmaceuticals plant in Tiranė. After a five-year hiatus, China and Albania resumed trade activities in 1983; the new relationship, however, lacked the intimacy of the twelve-year period of close cooperation in the 1960s and early 1970s. Albania carried on a modicum of trade with the Democratic People's Republic of Korea (North Korea) and Cuba.

In the mid-1980s, the growing interest of small import firms in the Albanian market accounted for a sharp increase in trade with Italy and West Germany. Italy was Albania's largest Western trading partner in the late 1980s. Italian exports to Albania accounted for about 20 percent of the West's exports to Albania in 1985, and Italy purchased 16.5 percent of Albania's exports to Western countries. Italy sold Albania metalworking and foodprocessing machinery, chemicals, iron and steel, metal products, vehicles, and plastics. The Italians imported petroleum products, chrome, copper, nickel and iron ore, and farm products from Albania. In the mid-1980s, West Germany accounted for about 15.5 percent of Western exports to Albania and 15 percent of Western purchases from Albania. Chromium ore and concentrates represented about 50 percent of Albania's exports to West Germany in 1985. The Albanians bought machinery, transportation equipment, and manufactured goods from West Germany. The collapse of Albania's Stalinist economic system opened the door for greater trade with Western Europe. In 1991 Tiranė was negotiating its first economic agreement with the European Community, under which each party would grant the other most-favored-nation status (see Glossary).

Albania was subject to all United States controls on exports to East European nations for decades. The country did not have most-favored-nation treatment and was not eligible for credits or loan guarantees from the Export-Import Bank of the United States (Eximbank). Nevertheless, the volume of United States trade with Albania grew from about US$1 million in 1973 to over US$20 million in 1982; it fell, however, to US$7.7 million in 1986. In 1991 the United States exported coal, wheat, butterfat, powdered milk, and other products to Albania with a total value of about US$18 million; to the United States, Albania exported primarily spices and fruit preserves worth about US$3.2 million. In 1991 Albania was attempting to conclude an economic agreement with the United States by which each nation would extend to the other most-favored-nation status.

Albania's trade with developing countries, which was driven mostly by a need to find and nurture political alliances, amounted to only about US$10 million out of a total trade turnover of US$513 million reported in 1982. Trade with developing countries was hindered because Albania sold its raw materials to and bought vital manufactured goods from wealthier, industrialized nations. Algeria, Costa Rica, Egypt, Iran, Libya, Mexico, and Turkey had had trade agreements with communist Albania.

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