TIRANA, November 25, 2024 - Albania has the potential to boost its resilience against climate change and tap into new economic opportunities through strategic investments and policies, according to the World Bank Group's Country Climate and Development Report for Albania, released today.
The report indicates that Albania, one of Europe's most disaster-prone countries, needs to invest $6 billion over the next decade to effectively protect its citizens and property from the growing risk of climate-related events, such as floods, wildfires, and landslides. Conservative estimates suggest that without proactive measures, climate-related economic damages could amount to 7% of Albania's GDP.
Additionally, the report highlights that investments in climate adaptation are not only essential but can also contribute to overall economic development. Studies from countries similar to Albania suggest that for every €1 invested in climate adaptation, returns can reach as high as €10, which includes reduced losses, increased economic opportunities, and social and environmental benefits.
"Climate action is a pathway to sustainable growth and a resilient future. Building resilience unlocks opportunities for businesses and households, drives job creation, and supports long-term economic growth," said Emanuel Salinas, World Bank Country Manager for Albania.
The report also discusses how to speed up Albania's energy transition toward net-zero emissions by 2050 through investments in wind, solar, and biomass technologies equipped with carbon capture and storage. These investments will diversify the energy system, improve efficiency, reduce dependence on imports, and electrify transportation and heating, thereby strengthening these emerging economic sectors.
"The private sector will be crucial for financing Albania's green transition, with an estimated 85% of the investment needed expected to come from private sources," said Nicolas Marquier, IFC Regional Manager for the Western Balkans. "Albania's ability to attract this investment relies on advancing regulatory reforms that enable green financing instruments, such as green bonds, and align with international sustainability standards, ensuring the country can effectively mitigate climate risks while unlocking new economic opportunities."
The report outlines a roadmap for Albania's transition to a sustainable and climate-resilient growth model, emphasizing immediate investments in resilience and adaptation to mitigate disaster impacts, a shift to renewable energy for long-term decarbonization, reforms in public finance to support climate initiatives and stimulate private investment, and enhancements to regulatory frameworks to encourage efficiency and innovation.
In Albania, the World Bank Group is working with authorities on projects aimed at building resilient infrastructure, improving water supply and sanitation services, and advancing sustainable agriculture development.
Download the Albania Country Climate and Development Report here.
