While Albania’s eCommerce sector is emerging, it lags behind its regional peers according to the World Bank report Albania eCommerce Diagnostic.
Identified as a “key growth opportunity for Albania”, eCommerce could provide Albanian companies access to new markets, lower overheads, and the ability to scale up at a lower cost. Those that have already embraced the online world include the tourism sector and business process outsourcing.
Many Albanian hotels and leveraged eTourism to attract guests through online booking sites. There are also a growing number of freelancers offering their services online and abroad and there is a high ratio of Albanian freelancers on sites such as Upwork.
The report found that during the COVID-19 pandemic, eCommerce emerged as an important pillar in the fight against the virus. Some 20% of Albanian firms have either commenced or increased their online business activity during the pandemic. While this is a good start, it is not optimum considering that more than half of consumers told the World Bank that they had increased their online shopping activity.
In 2017, around 7% of Albanians said they shopped online, opposed to 14% in the region and 70% in the US. One of the most popular business models is re-selling imported goods on the domestic market. So far there are not many Albanian businesses selling their own products online.
The World Bank identified nine priority recommendations that will help Albanian businesses leverage the opportunities associated with digital trade. It noted that there has to be collaboration and synchronicity between customs and delivery companies, digital connectivity, online payments, private sector capabilities, and eCommerce regulations.
The recommendations are:
Strengthening people’s trust in eCommerce companies through an industry code of conduct, certification, outreach campaigns, consumer protection framework, online dispute mechanisms, and simplified eCommerce parcel returns services.
Creating a business environment suited to the digital economy by amending tax legislation for the treatment of online sellers. The environment also needs to become more conducive to online payments as well as creating new online payment services laws.
Bolstering support programmes for entrepreneurs which includes creating training and financing programs for aspiring businesses. This should include incubator and accelerator programmes, outreach events, competitions, and regular evaluations to ensure value for money.
Increasing accessibility to high-speed internet. While much of Albania is connected through a fiberoptic cable, the internet remains expensive and slow.
Expanding access to online payments. This includes offering all citizens a basic payments account, a debit card, and transparent fees. Albania Post should offer its own postal card and expand its eWallet service.
Connecting all Albanians with online business opportunities through teaching marketing tools, processes for sending products and getting paid, and teaching disadvantaged groups how to access online marketplaces and how to sell their products online.
Decreasing the costs of cross-border logistics including a simplified customs procedure for trade in goods with key trading partners, a VAT online one-stop shop for importers, and changing the import excise value so it’s in line with EU standards.
Harmonizing regulations for eCommerce and bringing them in line with European standards. This includes measures for digital signatures including in judicial court settings, joining an international dispute resolution platform, upgrading privacy regulations to meet EU standards, and clarifying intermediary liability in terms of intellectual property rights.
Encouraging foreign direct investment including logistic fulfilment centres, online payment services, and other eCommerce facilitation services. This will create jobs and jump-start the growth of the Albanian eCommerce ecosystem.