TIRANA, June 20 (BV) – Albania’s economy is becoming increasingly dependent on tourism, construction, trade and real estate, while industrial production and other goods-producing sectors continue to lose momentum, according to first-quarter data released by the national statistics office INSTAT.
The figures point to a structural shift in the Albanian economy, with services driving growth while manufacturing and extractive industries struggle.
Industrial production contracted by nearly 5% in the first quarter compared with a year earlier, while industrial sales fell by more than 3%. Employment in the sector also declined, reflecting weakening activity across manufacturing industries.
The extractive sector, which for years has been an important source of export revenues, also recorded a significant downturn.
In contrast, service industries continued to expand. Hotels, restaurants, tourism-related businesses and transportation services all posted growth, benefiting from rising tourist arrivals and increasing domestic consumption.
The strongest performance was recorded in the real estate sector, where economic activity surged by more than 30%, highlighting the growing importance of property development and construction in Albania’s growth model.
Employment trends reflected the same pattern. According to INSTAT, jobs in real estate activities increased by 22.5%, while employment in hotels grew by 9.4%. Travel agencies expanded employment by 3.7%, and transport services by 3.3%.
Wages also continued to rise, particularly in sectors experiencing stronger growth and labour demand.
While the headline figures suggest a dynamic economy with rising activity, incomes and investment, economists warn that Albania’s growth is becoming increasingly concentrated in services and construction rather than productive industries capable of generating higher-value exports.
The trend has raised concerns among policymakers and financial institutions, which have repeatedly called for stronger support for manufacturing and agriculture to ensure more balanced and sustainable long-term growth.
As another record tourism season gets underway, Albania appears increasingly reliant on visitors, real estate development and consumer services, reinforcing a transformation that is reshaping the country’s economic structure.