Projection, the date when Albania potentially reaches the level of per capita income of the EU

Open Data Albania is analyzing different projections or scenarios which will try to estimate when will Albania reach the same level of per capita average income with European Union.

To establish the potential pessimistic and optimistic projections, we are considering the dynamic changes that the per capita income has undergone in the country. To that end, we’ll be assessing the growth progression or change in per capita income on annual basis in Albania and the EU countries.

In the 2000 – 2020 period, Albania was marked by a 4.3% increase on the annual per capita average income. It constitutes quite a hike for countries like Albania, still undergoing transition and with a very poor economic situation. The same indicator for the EU averages to 1.01%.

Source: World Bank, Statistical Database
PComments and analysis: Open Data Albania

Source: World Bank, Statistical Database
PComments and analysis: Open Data Albania

If we consider the annual growth for several years and accordingly, project its performance over time, we can draw an estimation on the year Albania can reach the EU level of per capita average income.

And since we are Projecting, we will try to calculate a baseline scenario, an optimistic and a pessimistic one.

We constructed the baseline scenario, by including the average annual increase for the 2000-2020 period (21 year period).

Meanwhile, in order to produce the optimistic scenario, we analyzed the pre-crisis years (2000-2008, 9 years). Whereas, for the pessimistic scenario, that of slow economic growth, the projection model was built based on post-crisis years (2014-2020, 7 years).

The optimistic scenario shows that Albania will approximate its level of per capita average income with the EU in 2060. That year the per capita average income in Albania and the EU will meet at the point of convergence, projected at $ 73 311/capita.

Source: World Bank, Statistical Database
PComments and analysis: Open Data Albania

Using the baseline scenario, with data extending over the 2000 – 2020 period, turns out that Albania will reach the EU average of capita income in 2078, at $ 61,195/capita.

Source: World Bank, Statistical Database
PComments and analysis: Open Data Albania

Under the pessimistic scenario, following the 2008 crisis – which affected the most countries like Albania, – the point of convergence will be achieved in 2154, at an income level of $ 96,556/ capita for both parties.

Source: World Bank, Statistical Database
PComments and analysis: Open Data Albania

The average per capita income in Albania in 2020 was 6.5 times lower than the EU member states average.

The projection, on the amount of time it will take our country to reach the European average income per capita level, excludes possible effects deriving from economic crisis or other factors affecting both economies.

Download excel: Projection, the date when Albania potentially reaches the level of per capita income of the EU
Comments and Analysis: Open Data Albania
Contribution by: Ilir Brasha
Translated by: Rezarta Caushaj