SMEs are particularly exposed to rising economic and environmental pressures, including climate risks, shifting trade dynamics, and the wider transition to a green economy. This cluster evaluates policies that strengthen SME resilience and competitiveness in this context. It examines five broader areas, assessing frameworks for SME greening, disaster resilience mechanisms, access to financial support, non-financial support and the role of business networks, as well as innovation ecosystems in supporting the transition.
SME Policy Index for Western Balkans and Türkiye 2026 – Economy Profile for Albania
Abstract
Although the Albanian economy recovered relatively quickly from the COVID-19 crisis, with economic activity growing by 3.9% in 2023 (Council of Ministers of the Republic of Albania, 2025[1]), small and medium-sized enterprises (SMEs) in Albania have had little time to rest. Since 2022, the ongoing energy crisis and a series of sudden global market shifts, particularly those linked to the green transition, have made decision-making increasingly complex for small business owners. Beyond decarbonisation, other accelerated trends, such as shifting geopolitics, fragmented trading systems, evolving consumer preferences, and the rapid rise of the digital economy, have further reshaped the business landscape (OECD, 2023[2]).
Encouragingly, only a small share of Albanian businesses expect the green transition to have a negative impact, while around 25% anticipate strong positive effects on their operations and opportunities (RCC, 2024[3]). However, many firms continue to view administrative and legal complexity, as well as limited know-how, as major barriers to keeping pace with evolving market standards, particularly in relation to the EU Green Deal.
This section will therefore shed light on government policies that aim to enhance SME agility and adaptability in the decarbonisation-trade nexus, key conditions for building resilience and securing sustainable growth in increasingly dynamic market environments.
3.1.1. Smoothing SME pathways to a green economy
To date, there remains scope for Albanian SMEs to contribute more to the growth of the green economy. While there are no data on SMEs’ energy and carbon intensity, existing statistics suggest that Albania has relatively high energy productivity compared to peer economies (OECD, 2025[4]), and overall carbon intensity decreased by more than 30% between 2015 and 2023 (JRC, 2024[5]). However, these developments are driven primarily by its economic structure with a service-focussed economy and high reliance on hydropower, albeit sensitive to climate-induced changes in precipitation levels, exemplifying the link between business decarbonisation and resilience building.
At the SME level, existing data suggest that more than half (53%) of Albanian SMEs do not take any measures to become greener or more resource efficient, compared to only 6% in the European Union and an average of 22.5% in other Western Balkan and Türkiye (WBT) economies (European Commission, 2024[6]). This may indicate the limited effectiveness of existing private-sector policy measures, as well as low awareness or weak incentives for SMEs, given minimal charges on natural resources such as waste and water that fail to enforce the polluter-pays principle (OECD, 2024[7]).
Most relevant national policies and strategies for green growth in Albania include measures targeted at SMEs (Table 3.1). Key documents that include direct measures are the National Energy and Climate Plan 2023-2030 and the Business and Investment Development Strategy (BIDS) 2021-2027. Albania’s revised National Adaptation Plan (NAP) 2026-2036, for the first time also includes focussed measures to increasing SMEs’ role in the green economy, expected to increase impact compared to the preceding NAP that recorded a low completion rate of only 15% of planned activities between 2019 and 2023 (Ministry of Tourism and Environment, 2023[8]). The second NAP features business resilience considerations more prominently with targeted measures to boost climate-resilient private sector development.
SME-specific measures will also be discussed during the upcoming drafting of the Long-Term Low Emission Development Strategy, as the current Climate Change Strategy 2020-2030 and Action Plan do not yet include any specific measures for SMEs. Additionally, regarding the circular economy, the recommended activities in the Circular Economy Roadmap, developed in collaboration with the OECD, are expected to be operationalised through the planned revision of the Action Plan for the Integrated Waste Management Strategy by 2027, helping to translate sectorial priorities into concrete government measures. Lastly, Albania’s Reform Agenda constitutes a complementary policy document aligned with these strategies and is particularly important for securing investments that can bring the Albanian economy closer to integration with the EU Single Market and sustainability standards.
Note: Indirectly refers to the private sector being considered in the policy document, but no concrete SME-targeted measures are included.
Source: Information provided by the Albanian government during the assessment period in 2025.
Despite a growing strategic focus on supporting green businesses, SME value creation in the green economy, with businesses taking action on climate change mitigation and adaptation, is still relatively low. Around 22% of Albanian SMEs offer green products and services, but their market promotion, for example, using ecolabels, lags significantly behind that of SMEs in the European Union (European Commission, 2024[6]). A certification body has not yet been established, and legally required guidelines for granting ecolabels across different product groups have so far been developed only for textiles (OECD, 2024[9]). As such, SMEs cannot actively leverage ecolabels to more easily market environmentally friendly products. In this context, AIDA’s Certification Grant Scheme provides some targeted support by helping SMEs obtain internationally recognised standards, such as ISO 14001:2015 for environmental management systems and ISO 50001 for energy management. Yet, uptake is unknown.
There is limited evidence that SMEs in Albania receive guidance on greening their operations and production to improve their positioning in the domestic and export markets. However, in light of the growing integration of sustainability policies into international trade and consumer trends, this is becoming more essential for competitiveness. No assessment has been conducted on whether responsible institutions have sufficient staffing and expertise to address SME concerns about the regulatory burden of environmental compliance, particularly regarding alignment with the EU Green Deal. Such alignment will be critical to enable Albanian SMEs to integrate into EU Single Market value chains. On a positive note, the Ministry of Economy and Innovation established an Enterprise Consultative Council in 2024. This platform is designed to facilitate a structured dialogue with the private sector, including on SME greening. Its effectiveness could be further strengthened by ensuring the permanent participation of ministries responsible for energy and environmental protection, thereby improving cross-sectoral coordination.
Since the last assessment, the government has not taken additional efforts to reduce administrative and regulatory burdens or introduced targeted incentives to increase the adoption of environmental management systems among SMEs. Recent legal reforms, notably the Law on the Promotion of Renewable Energy Sources (2023) and the Law on Integrated Waste Management and Extended Producer Responsibility (2025), have helped establish clearer sustainability standards and a more predictable framework for green investment. However, there are still no data on how many SMEs use an environmental management system or on how the government is promoting the adoption of international standards to environmental management. This slow implementation suggests inadequate consultation and involvement of SMEs in policy design, the absence of regulatory impact assessment mechanisms, and a limited budget dedicated to activities supporting the greening of SMEs.
Insights into the extent of public funding invested in advancing green SME activities, as outlined in government strategies, are generally lacking. For example, the National Energy and Climate Plan still needs to be updated to reflect the Strategic Environmental Assessment. In addition, no documentation is available on SME-specific activities. Further, the monitoring of the BIDS for the 2021-2024 period does not clearly show how the allocated budget was distributed across the greening measures implemented.
The insufficient prioritisation of enabling SMEs to produce and operate reliably and more sustainably not only stunts the potential growth of the national green economy, but could also endanger SMEs’ competitiveness abroad. To date, the Albanian government has not considered SME needs and vulnerabilities through targeted just-transition policies. A 2023 report shows that around 64% of companies experienced up to five power outages in a month, and 17% experienced more than five per month (Albania Investment Council, 2023[10]). This suggests that, to increase SME resilience to market trends, SMEs should be included in the dialogue on diversifying Albania's energy sources. This would also enable them to avoid exposure to price volatility arising from the need to import energy when rainfall patterns are unfavourable. Figure 3.1 shows that surges in electricity prices for industry in 2022 and 2023 were largely driven by increases in energy and supply costs, both years when Albania was importing energy.
Prices in EUR/kWh
Note: Based on annual data of consumption of kWh in all bands.
Source: Eurostat (2025[11]).
Further, other measures, including climate change adaptation or the adoption of climate technology, would be essential for sectors expected to be hit hardest by climate change impacts, as well as the growing importance of environmental, social and governance (ESG) regulations in international markets (IFRS, 2024[12]). Examples of this are concentrated in highly nature-dependent and climate-vulnerable sectors, such as tourism and agriculture, but also in emissions-intensive trade-exposed sectors producing goods like cement, steel and aluminium, which are covered under the EU Carbon Border Adjustment Mechanism (CBAM) (see Section 3.1.2). Recent survey data indicate that 71% of Albanian SMEs consider financial incentives to be the most effective means of supporting the development of new production processes (European Commission, 2024[6]). Yet, to date, the government has not established a comprehensive incentive framework to help SMEs in these and other sectors strengthen business resilience and expand greener product and service offerings.
With respect to campaigns aimed at raising SME awareness and knowledge on greener business practices or other resilience-enhancing measures that could strengthen their contribution to a sustainable economy, a few initiatives are ongoing. However, their reach and impact remain unverified. Since 2015, the Law on Tourism has provided support for tourism enterprises to improve resource efficiency and encourage eco-certification; however, no concrete implementation measures have been reported. The government also reports encouraging sustainable SME practices through its NECP activities, measures in the revised BIDS, and donor-supported projects, which provide training and advisory support on energy efficiency and the circular economy. Nevertheless, these nationally and locally implemented awareness-raising initiatives have not been systematically monitored.
3.1.2. Boosting SME competitiveness in sustainable value chains
According to a 2024 study, 58% of Albanian businesses believe the green transition will have a positive impact on their operations, the most optimistic outlook among private sectors in the Western Balkans (RCC, 2024[3]). Similarly, around 60% expect that increasingly green EU markets and opportunities to integrate into sustainable value chains will influence their business decisions (RCC, 2024[3]). These findings suggest strong interest and readiness within the Albanian private sector to leverage the green transition to deepen integration into sustainable, resilient value chains.
This momentum is also reflected in the revised BIDS 2021-2027, which identifies the sustainable and green transition as a priority for export promotion. The strategy seeks to position Albania to benefit from rapidly evolving international value chains by not only diversifying participation, but also attracting nearshoring projects and fostering regional value chains focussed on the green transition, offering opportunities for both export-oriented and domestic SMEs.
As one of the strategy’s key intervention areas, SMEs are to receive stronger support to unlock untapped potential, particularly in high-growth value chains. In line with the BIDS 2021-2024 Action Plan, national and local government bodies have undertaken several initiatives, including facilitating partnerships between foreign investors and Albanian businesses, preparing reforms to the technological and economic development zones system to better promote green industrial parks in the medium term, supporting the participation of Albanian SMEs in international green fairs, and enable start-ups and SMEs through the establishment of the Green City Lab in Tirana.
Despite these efforts, the impact in terms of SMEs reached has so far been limited. In this context, the Albanian Investment and Development Agency (AIDA) has a central role to play in more prominently mainstreaming greening and resilience building across its wide range of initiatives and grant schemes, as well as through its co-ordinating role with the Enterprise Europe Network (EEN). Between 2022 and 2025, the EEN supported around 300 SMEs and facilitated 19 international collaborations with Albanian businesses (Enterprise Europe Network, 2025[13]).
The government can also help improve market conditions for green products and services by using green public procurement (GPP) to stimulate demand and incentivise innovation in the industry. A step forward in this regard is the adoption of the new Public Procurement Strategy 2024-2030, which includes a dedicated objective on GPP and social procurement, plans for secondary legislation to align with the EU acquis, and staff training. The strategy also emphasises SME participation in public tenders to improve transparency and equal treatment. Additionally, the Integrated Waste Management Strategy mentions GPP as a key policy instrument to encouraging public bodies to use environmental criteria when purchasing goods and services. However, it does not provide specific guidance or support to help SMEs meet GPP standards, nor does it clarify how upcoming GPP opportunities will be communicated. Without systematic early outreach, SMEs may remain at a disadvantage in competing for contracts.
Albanian SMEs can further build resilience and competitiveness in green value chains by participating in industry-driven action. The Albanian government has promoted business-to-business collaboration in key sectors to foster green innovation and SME growth, both locally and abroad. For example, 30 SMEs engaged with international companies through the Diaspora Mentoring Programme under the EU4Innovation project. SMEs often benefit from collaboration through clusters, gaining access to finance, investors, suppliers and export markets. While sectoral clusters are emerging in Albania, past donor-driven initiatives lacked sustainable stakeholder engagement. Currently, only a small wood cluster is active, with limited SME involvement and little focus on green practices. Moreover, regional needs and economic priorities are often overlooked in policy design. Encouragingly, in 2022, AIDA conducted a comprehensive needs assessment of companies to identify tailored approaches to stimulate exports and support SMEs. These findings were translated into concrete measures through the Export Promotion and Facilitation Programme 2026-2030, adopted in December 2025.
As the EU Single Market (Albania's main export destination)1 advances decarbonisation and green policies, these are becoming increasingly important for trade and investment in Albania as well. The European Union’s CBAM, for example, is expected to impact supply chains, with importers expected to select suppliers that can report emissions data or shift to EU-based ones altogether (Business Europe, 2025[14]). In response, Albania is advancing legislative alignment through its EU accession negotiations under Chapter 6 on Company Law, which covers accounting and reporting standards, including those related to corporate sustainability. Donor projects such as the EU4Circular Economy and Growth have further supported legal alignment of market standards, implementation capacity and development of circular business models for SMEs. Additionally, in 2023 the Swedish government funded a United Nations Joint Programme to assess the alignment of Albania’s textile and footwear sectors with sustainable business practices, aiming to strengthen competitiveness.2 The textiles value chain has also been identified as a priority area for SME integration support. However, the government has not yet developed comprehensive or sector-specific guidelines and training for SMEs to better prepare them for the CBAM.
Although Albania’s share of CBAM-affected exports is relatively low compared with that of their peers (EBRD, 2024[15]), SMEs still require government support to strengthen their long-term market position, especially with other key ESG regulations like the Ecodesign for Sustainable Products Regulation (ESPR)3 on the horizon. Despite Albania’s relatively low carbon intensity, its exports remain highly undiversified. It ranks lowest among WBT economies for export diversification and complexity (see Figure 3.2), with no improvement over the past decade (Harvard Growth Lab, 2025[16]).
Notes: Economic complexity measures the diversity and sophistication of the productive capabilities embedded in each economy's exports. Data for Kosovo* and Montenegro are unavailable.
Source: Harvard Growth Lab (2025[16]).
The ESPR’s application to priority product groups in the first batch, launched in April 2025, increases pressure on Albania to diversify sustainable exports to the European Union and build SME resilience in vulnerable value chains. However, Albania has yet to assess alignment with the ESPR, and ecodesign policies remain underdeveloped. Green value chain integration and sustainability criteria have begun to feature in strategic discussions, but a dedicated export promotion programme to advance them remains absent. Efforts to strengthen green investments and support for the integration of SMEs in global value chains have not been strengthened since the last assessment. There is limited evidence of SMEs receiving capacity building support to adapt to emerging sustainability standards, including the ESPR. This is a missed opportunity, as Albania has seen an increase in foreign direct investment (FDI) in renewable energy and manufacturing. These developments could be linked to a nearshoring trend as investors seek proximity to the EU Single Market and may bring benefits to SMEs in terms of business and partnerships with foreign companies (WIIW and WB6CIF, 2024[17]). There are also opportunities to better support SMEs in applying for EU funding, as the government signed an agreement to participate in the Single Market Programme in 2024.
The way forward
Strengthen the implementation and monitoring of measures to support SMEs in the green economy. Despite targeted greening policies, evidence on implementation and impact since 2022 has been limited. The newly established Enterprise Consultative Council could prioritise the following issues on its agenda to remove market barriers and enable more informed investment in SME greening: ensure business feedback is adequately reflected in policy; strengthen data collection and transparency; and promote effective regulatory impact assessments to avoid undue burden on SMEs. To maximise its impact, the government should also ensure the strong and permanent involvement of ministries responsible for energy and environmental policies, so that implementation is better coordinated across sectors.
Develop guidance and outreach to boost SME participation in green public procurement. Building on the newly adopted GPP strategy, the government may consider conducting early, systematic outreach to inform interested SMEs and allocating resources by employing instruments to ensure a level playing field for smaller contractors. A good practice case is presented in Box 3.1.
Mainstream SME greening and resilience concerns more prominently in export and investment promotion programmes. While the BIDS prioritises the green transition for export promotion, linked projects had only minor impact on the SME sector and value chain integration is still limited. AIDA, as a leading institution in this area, should further strengthen these aspects in existing grant schemes and initiatives, particularly under the post-2027 BIDS. Strong potential lies in leveraging its co-ordination of the Enterprise Europe Network to help SMEs prepare for EU Green Deal legislation, such as CBAM and ESPR, and attract investments, particularly in priority sectors like minerals, textiles, and plastics.
Ensure the effective implementation of the National Adaptation Plan (2026-2030) to boost SME climate resilience. Given that the previous adaptation strategy achieved low completion of activities and largely overlooked the concerns of SMEs, the government should ensure that sectoral vulnerabilities to climate change are thoroughly assessed and addressed. While relevant private-sector-focused measures, particularly in tourism and agriculture, have been developed, their impact will depend on adequate and sustained funding, as well as the institutional capacity to deliver them. This includes ensuring that responsible agencies are sufficiently resourced, co-ordinated, and equipped to translate planned actions into tangible support for SMEs. At the same time, attention should be given to the readiness of businesses to uptake these measures. This may require targeted outreach, simplification of access procedures, and capacity building efforts to ensure that SMEs, often constrained by limited time, knowledge, and financial resources, can effectively engage with and benefit from available support. Finally, the planned monitoring and evaluation framework should be used not only for tracking implementation progress, but also as a practical tool for continuous learning. Systematic feedback from implementation and SME uptake should inform iterative adjustments, helping to improve the design and delivery of adaptation measures over the coming period.
To support its public administration entities, Costa Rica updated its Strategic public procurement manual in December 2024. This manual aims to guide the analysis and decision making for responsible procurement.
The overarching Guideline for the Implementation of Strategic Public Procurement underlines the role of socially equitable development that seeks, next to other sustainable development goals, enhance SME access to public procurement.
The manual further contains three thematic guidelines on environmental, social and innovation criteria as well as a toolbox that contains a criteria catalogue for 14 products and services and a matrix for the evaluation of sustainability criteria in bids with a view to promoting the participation of SMEs in public procurement.
Albania can draw on this best practice to advance its objectives on GPP under the Public Procurement Strategy 2024-30, which envisions closer alignment of the regulatory and legal framework with EU practices and the strengthening of procurement staff capacities through appropriate guidance and training.
Source: Ministry of Finance of Costa Rica (2024[18]).
Recent crises affecting Albania, such as the 2019 earthquake and the COVID-19 pandemic, have highlighted the particular vulnerability of SMEs to economic and environmental shocks. More than 3 500 businesses were affected by the earthquake, which caused an estimated USD 168 million in losses and damages to the commercial sector (World Bank, 2021[19]). According to the World Bank (2021[19]), other disaster risks, increasingly frequent due to climate change, such as flash floods, account for roughly 30% of total economic losses related to damage to physical assets.
Structural weaknesses, including low diversification of economic activities, limited access to finance, and insufficient knowledge resources, further constrain SMEs’ ability to respond effectively to crises. As a result, over 30 000 businesses were forced to close during the COVID-19 pandemic (Tirana Times, 2020[20]). These macroeconomic consequences underscore the urgent need for government action to establish targeted mechanisms that support SMEs in crisis prevention and recovery.
This section examines how mechanisms to support SMEs are designed to strengthen their resilience to economic shocks, natural hazards and increasing climate-related risks.
3.2.1. Enhancing crisis-resilient strategies to prevent SME bankruptcies
The economic shock triggered by COVID-19 highlighted significant gaps in government efforts to prevent and manage surges in business failures during crises, whether economic or environmental. As in many other economies, SMEs were among the hardest hit, representing 98% of all businesses that went bankrupt in Albania after the onset of mitigating measures related to COVID-19 (Euronews, 2020[21]). While the Albanian economy has shown a robust recovery since the pandemic, average business continuity has not improved since the last assessment in 2022. The number of newly established economic units has yet to return to pre-COVID levels, while closures have increased to levels last seen at the height of the pandemic (see Figure 3.3).
Total number of legal units
Note: Based on the author’s calculations, the closures for each year are calculated by subtracting active legal units at the end of each year t from the sum of active legal units at the end of the prior year t-1 and the new registrations in year t.
Source: INSTAT (2025[22]).
While some existing programmes include measures to support SMEs in financial distress, the overarching SME policy framework, namely the BIDS 2021-2027, does not provide targeted instruments to enhance access to prevention tools or to mainstream co-ordinated government response across ministries during crises. Key gaps include the absence of a data-driven early-warning system (EWS) linked to effective intervention mechanisms by public authorities and other relevant stakeholders (see Dimension 2). More broadly, data on the use of business reorganisation and liquidation procedures are not systematically collected or disaggregated by firm size, constraining efforts to improve fast-tracked out-of-court restructuring mechanisms for SMEs.
These gaps are critical since business default risks are not matched by sufficiently strong insolvency-prevention measures that prioritise damage limitation and the swift reallocation of capital to productive uses, including through orderly market exits for firms that are no longer viable. As climate-related risks intensify in Albania, the likelihood of SME defaults is expected to increase due to physical asset damage and supply-chain disruptions (Bank of Albania, 2023[23]).
Climate change, mostly through extreme weather events and interconnected natural disasters, has worsened the economic struggles of SMEs, especially during the global recession. In Albania, events like earthquakes and the increasing risk of floods and wildfires (World Bank, 2024[24]) often cause major property damage and business interruptions, pushing many SMEs toward insolvency. The challenge is compounded by the fact that most SMEs remain uninsured (World Bank, 2021[19]), making bankruptcy prevention even harder.
In response, Albania is strengthening its focus on disaster risk management and climate change adaptation through its Disaster Risk Reduction Strategy 2023-2030 and the NAP 2026-2036, that was approved in 2025. However, to date, there has been no reporting of SME-targeted adaptation or disaster resilience measures. Furthermore, the government has yet to co-ordinate with key partners, such as private banks and insurance providers, which could play a vital role in expanding SME access to finance and tailored insurance products.
Another critical aspect for preventing disaster-induced business failure relates to multi-hazard EWS. Issued warnings remain unreliable, with situational awareness weakened by the lack of integration of geographic information system (GIS) data into the EWS, as well as by outdated and non-functional public alert signals (UNDRR, 2025[25]). Additionally, targeted community training to help stakeholders interpret and use the data for co-ordinated prevention measures is largely absent. This would be especially critical for SMEs operating in high-risk environments, which need accurate, up-to-date data to effectively protect their employees, assets and infrastructure from hazard exposure. SMEs are also often unaware of the importance of investing in disaster risk reduction and climate adaptation, areas that have seen little investment from national or local authorities in recent years (World Bank, 2024[24]). There have been yet no targeted awareness campaigns or government guidance to help SMEs assess risks, develop business continuity strategies, or access suitable insurance products.
It is estimated that globally, SMEs account for around 75% of losses from disasters (UNDRR, 2021[26]). As the frequency and severity of climate change-induced weather extremes increase, it will be critical to ensure that SMEs can access funding to bear the additional burden. As of now, there are no financial incentives offered to Albanian SMEs that invest in preventive measures or longer-term resilience against disaster risks or climate change, such as nature-based solutions. On a more positive note, though, there are government funds that could be used for this purpose, i.e. the Solidarity Fund, and many partners, such as the European Union4 and the World Bank (through the Global Facility for Disaster Reduction and Recovery), have assisted the government in increasing disaster risk management capacities, paving the way for more effective disaster risk financing. However, there are no data on how many SMEs have benefitted from any funds over the last five years.
3.2.2. Increasing SME recovery capacity and second-chance opportunities
While preventive measures are essential to minimising business insolvencies and ensuring effective institutional operations, building SME resilience requires broader efforts focussed on the survival and recovery of business activity during and after times of distress. Given that SMEs remain the backbone of the economy, it is vital to support their rapid recovery after economic or environmental shocks, as they drive value creation, consumption and employment.
Albania still lacks a dedicated second-chance programme for SMEs and honest entrepreneurs who have undergone bankruptcy proceedings. While the insolvency framework includes relevant provisions, especially fast-tracked reorganisations, key gaps remain, such as limited legal protection enabling SMEs to secure new financing during reorganisation and the fact that the discharge mechanism for residual obligations applies only to natural-person debtors. These administrative constraints and procedural bottlenecks could contribute to a persistent cultural stigma around business failure, thereby discouraging entrepreneurial activity, particularly during and after crises.
In the past, the government has introduced targeted relief measures to address business distress caused by disasters, including wage subsidies, higher social spending, and credit guarantee schemes through commercial banks to support salary payments and ease access to working capital and investment financing (World Bank, 2021[19]). In response to the 2019 earthquake and the COVID-19 pandemic, additional measures such as tax deferrals and value-added tax (VAT) exemptions were made available to SMEs. However, these interventions placed further strain on the fiscal budget, and no dedicated government strategies currently exist to address climate-related disaster risks. Plans to establish a relief funding system for the most climate-vulnerable SMEs or for financially viable firms whose survival would have wider spillover effects on long-term employment, for example, are therefore absent.
A key gap in post-disaster support for SMEs is the lack of modern financial and insurance products tailored to their needs amid increasing climate-related risks. As extreme weather events become more frequent, causing physical damage and disrupting critical infrastructure such as power and water systems, as seen across Western Balkan economies, including Albania in the summer of 2024 (Reuters, 2024[27]), SMEs remain without adequate tools to manage these impacts. Authorities have not yet sufficiently collaborated with commercial banks or insurers to adapt financial products and raise SME awareness of recovery financing options, nor have they strengthened efforts to ensure businesses have reliable access to critical infrastructure. This reflects deeper structural challenges: an underdeveloped insurance sector with unknown capacity to absorb future climate-related losses and a lack of accelerated investment in critical infrastructure. However, SMEs are also not educated about, or incentivised to establish, “rainy day” funds to fund emergencies.
Generally, longer-term adaptation measures for SMEs still remain very limited in practice. The progress report on the NAP 2019-23 does not report on any actions targeting SMEs, and the few activities directed at farmers have so far been weak in both implementation and scope. Stronger efforts will be needed in the implementation of the new NAP to build SME resilience to climate-aggravated disasters across sectors.
Against this backdrop, the ALBAdapt project illustrates how more strategic approaches could be scaled in support of business continuity and innovation for disaster resilience (GCF, 2024[28]). Financed by Gesellschaft für Internationale Zusammenarbeit GmbH (GIZ), the Green Climate Fund and the Swiss government, and implemented in co-ordination with the Ministry of Tourism and Environment, the Ministry of Defence, the National Civil Protection Agency and the Institute of Geosciences, the programme offers avenues to expand ecosystem-based adaptation measures and climate-related business services. These are particularly relevant for strengthening recovery capacities in tourism-dependent coastal areas. Under its third component on climate-informed investment decisions, the programme supports the ideation and incubation of high-potential climate service business ideas and community building through the AlbaniaTech platform, addressing a broad range of business adaptation needs and deployment options across multiple hazards.
The way forward
Develop targeted corporate insolvency prevention policies and establish a fully-fledged early warning system. The government should build on AIDA’s experience in assisting businesses, through several financial support schemes and advisory services, to refine and scale up effective preventive approaches. Further data collection and aggregation are needed to develop an evidence-based EWS. The National Bankruptcy Agency should allocate dedicated budgets and work with the Ministry of Economy and Innovation to design and implement related prevention policies. Legally, removing the requirement of imminent bankruptcy to initiate expedited reorganisation would also simplify access for SMEs seeking to address financial distress early.
Digitise and streamline insolvency procedures to ease business exits and introduce SME-focussed second-chance policies. Currently, no policies support businesses in preparing for recovery during or after bankruptcy proceedings. The manual nature of procedures leads to lengthy processes and a growing backlog of insolvency cases, straining administrative capacity. Additional legal inefficiencies, such as multiple reorganisation plan submissions and excessive burdens on failed entrepreneurs, further deplete the resources of both debtors and creditors, hindering effective business recovery. These challenges should be addressed through targeted measures within a second-chance programme, implemented by a competent agency such as AIDA in co-operation with the National Bankruptcy Agency.
Strengthen multi-hazard early warning systems and raise awareness of SME adaptation and disaster risk resilience. The current multi-hazard EWS remains suboptimal and requires urgent improvement. Equally important is enhancing awareness and use of the system among citizens and SMEs. The government is encouraged to increase investments at both national and local levels and provide education and training for SMEs on risk analysis and preparedness. These targeted activities and programmes should be clearly integrated in measures to be implemented through the NAP 2026-2036.
Introduce incentives and dedicated funding for SME investments in disaster prevention and recovery. The government may consider incentivising SMEs, particularly those in hazard-prone areas, to use advisory services and training on business continuity planning. In addition, co‑ordination with banks and insurers to tailor financial products, along with subsidies for climate risk insurance, for example, would help equip SMEs with the tools needed to better manage and recover from adverse impacts. Recovery support measures should build on lessons from the evaluation of the effectiveness of post-COVID assistance programmes.
As Albania advances its climate neutrality goals, SMEs must play a central role in the transformation. Yet, they often face barriers in accessing finance, struggling with complex requirements and funding for higher-risk projects, such as greening initiatives or resilience measures. Green finance in Albania remains nascent, largely focussed on renewable energy (UNDP Albania, 2024[29]).
Globally, ESG-based financing is expanding, with institutional investors recognising the importance of addressing climate and disaster risks, supported by policymakers promoting sustainability-linked financial instruments. This trend is particularly relevant for Albanian SMEs engaged in international trade and those operating domestically, given the banking sector's dominance by foreign institutions (IMF, 2025[30]).
To ensure SMEs can participate effectively in a low-carbon economy, the government needs to align with the EU Taxonomy and international sustainable finance standards while providing clear guidance and accessible financial mechanisms.
This section will therefore examine how the national sustainable finance framework and programmes are addressing business needs and enabling donor-led project outcomes to spill over into systemic improvements for SME access to finance in the green transition.
3.3.1. Supporting SMEs in an evolving sustainable finance framework
Since the last OECD assessment in 2022, the Albanian government has taken decisive steps towards promoting sustainable finance. The Bank of Albania adopted a Medium-term Green Strategy in May 2023 to address climate-related risks in the financial sector. Further, it reinforced its commitment by joining the Sustainable Banking and Finance Network in 2024. Similarly, the 2023-2027 Strategy of the Financial Supervisory Authority of Albania outlines steps to integrate ESG factors into investment decisions and to align green finance practices with the EU finance framework. However, these initiatives have yet to be reflected in SME policies, particularly in measures to support financing and (voluntary) disclosure frameworks for non-financial enterprises.
Encouragingly, in 2025 the Bank of Albania signed an agreement with the European Investment Bank to develop a national taxonomy for sustainable business activities. However, this process will take time and will initially be implemented on a voluntary basis. Nonetheless, these ongoing developments, particularly alignment with the EU Taxonomy and development of reporting requirements for financial institutions, are expected to affect SMEs, as banks begin incorporating these principles into governance and risk management frameworks. This will translate into growing demands on SMEs to provide information on the environmental performance of their operations when seeking finance. At the same time, similar pressures are already emerging through value chains, as SMEs supplying EU-based firms may be required to provide sustainability-related data in line with the Corporate Sustainability Reporting Directive. Without adequate support, these evolving requirements risk creating additional barriers to finance and market access for smaller firms.
The government still needs to strengthen co-ordination with key financial institutions, such as the newly established Albanian Development Bank and commercial banks, to better inform and support SMEs in addressing their sustainable finance needs. Promisingly, the government already works closely with the central bank and the Albanian Association of Banks (AAB), which plays a key role by providing training for bank employees on ESG, sustainable finance and green economic activities.
As a direct result of this co-ordination among the AAB, the Ministry of Finance, and the Ministry of Agriculture and Rural Development, the Sovereign Guarantee Scheme for Agricultural Lending was established in 2025. The scheme, supported by a total fund of ALL 3 billion (Albanian lekë) (approximately EUR 30 million), is designed to support higher-risk projects related to technological innovation, including initiatives linked to the green economy in the agricultural sector.
However, none of the government’s credit guarantee schemes for SMEs, including the State Guarantee for the Processing Industry of 2024,5 specifically target sustainable, social or climate-friendly practices. This limitation could make it more challenging for SMEs in other sectors to access financing for their green initiatives through traditional banks. Nonetheless, there have been positive developments in improving overall access to sustainable finance. The establishment and ongoing updates of the Access to Finance platform (see Box 3.2) now allow SMEs to more easily search for suitable financing options.
Policy context
Given the overall lack of public financing schemes and their complexity or restrictive eligibility criteria, AIDA launched the Access to Finance platform in 2023. The platform aggregates financial support from public and private, national and international sources, serving as a one-stop-shop for SMEs seeking to expand or invest in their operations.
Operational aspects
AIDA leads the initiative, continuously collecting feedback and issuing recommendations to improve the platform. It publishes an average of two to three calls per month and is updated weekly. In 2023, new features were added, including spaces for success stories, comments and expert outreach. SMEs can specifically search for funding schemes targeting the green transition, eco-innovation, environmental protection and sustainable resource use.
Impact
While data on SME applications for greening and resilience-related schemes is not available, general usage shows strong engagement. By mid-September 2024, 131 calls had been published, and the main website received over 250 000 visits. Users are predominantly young entrepreneurs: 33.5% are aged 25-34 and 27.5% are aged 18-24, indicating strong interest among youth.
Source: Ministry of Economy and Innovation (2025[31]).
Regarding government-provided financial incentives, there is no evidence of programmes specifically focussed on sustainable finance. Although the BIDS 2021-2024 Implementation Monitoring Report notes that AIDA has collected feedback from SMEs on their financing and service needs, it is unclear to what extent the sustainable finance requirements of SMEs are incorporated into broader initiatives, such as the state budget grants administered by AIDA.
Another major barrier to developing sustainable finance for SMEs in Albania is the low level of awareness among entrepreneurs, which translates into weak demand for such products. According to the OECD/International Network on Financial Education (INFE) 2023 International Survey of Adult Financial Literacy, only 6.8% of adults in Albania are aware of financial products labelled “sustainable,” and just 0.2% hold such products (OECD, 2023[32]). Therefore, non-financial support from the government is also crucial to further scale the market and pool the potential for larger investments in green projects, thereby leading to greater impact and attracting more international investors.
In this context, the adult financial literacy framework was updated through the National Strategy for Financial Education and Inclusion, adopted in 2024, which aligns core competencies in sustainable finance with the EU/OECD standards. The government's offer of literacy trainings now includes modules on sustainable finance, aimed at building SME capacity and understanding of long-term benefits such as greater climate resilience, improved reputation, access to new markets and funding, and technical support for voluntary ESG reporting. The Tirana Chamber of Commerce and Industry, together with the International Chamber of Commerce in Albania and Q-Lever, held a workshop in 2024 to help SMEs integrate ESG into their strategies. The training covered defining key performance indicators, using an assessment matrix for sustainability reporting, and preparing reports in accordance with global sustainability reporting standards (CCI, 2024[33]).
3.3.2. Increasing SME access to sustainable (bank and alternative) financing
Given the diversity of SMEs in terms of size, sector, technological maturity, and location, firms require different financial solutions depending on their business models and stage of development. Broadly, three SME groups can be distinguished by their role in the green transition: early-stage green start-ups (“innovators”) developing new technologies or business models; more mature green firms (“enablers”) scaling up innovative solutions; and established SMEs seeking to adopt greener processes, products, or technologies (“adopters”) (OECD, 2025[34]).
Compared to traditional finance, sustainable finance instruments that integrate ESG criteria, alongside profitability, could better address the distinct needs of these groups and improve access to finance for SMEs that contribute to sustainable development goals.
Environmental costs are often not fully priced into markets, which increases uncertainty about the returns of green investments, while information gaps further limit lenders' and firms' ability to assess viability (OECD, 2025[34]). Considering the financing constraints SMEs already face (see Cluster 1) and the additional factors that further hinder investment in greening and long-term resilience through finance for adaptation projects, the government needs to make concerted efforts to improve conditions for sustainable financing.
Grant schemes implemented by AIDA, although not exclusively targeted at SME greening, play an important role in improving access to finance for green investments. In 2024, the Ministry of Economy and Innovation introduced the “Smart and Green Future” grant scheme (implemented through the GIZ supported ProSEEED 2.0 project), marking a shift from general SME financing support towards more targeted support for the green transition. The programme was open to established SMEs, start-ups, and collaborative projects focused on developing sustainable business processes, particularly in environmental protection and digitalisation. In total, 75 projects received funding, with grants of up to EUR 4 000 for individual projects and EUR 7 000 for collaborative initiatives. While this represents a positive step towards dedicated green support instruments, the overall scale of funding remains relatively limited.
Bank financial instruments continue to dominate Albania’s financial sector, accounting for 90% of total assets as of 2023 (Bank of Albania, 2024[35]). However, bank financing, largely debt-based, is not always suitable for SMEs’ green projects. This is particularly true for innovator SMEs without a finished product, proof of concept, or intangible assets they cannot easily use as collateral, e.g. firms developing software-based solutions. But even more established businesses that distribute or seek to adopt existing green technologies to improve their environmental performance may require more flexible financing instruments.
While green loans are still not widely available, existing products serve SME adopters looking to buy green solutions that enhance specific operational functions, such as energy efficiency. International development partners have been implementing initiatives to encourage lending to SMEs pursuing broader ESG goals. For example, in 2022, the European Bank for Reconstruction and Development (EBRD) provided a EUR 3 million loan to ProCredit Bank in Albania, complemented by an EU-funded grant of EUR 450 000, covering 15% of the loan amount. Half of the total loan was earmarked for financing green technology and energy efficiency projects.
Another example is the SME Reboot Programme launched by the EBRD in 2024 to further increase its lending in partnership with ProCredit Bank Albania, providing an additional EUR 6 million. At least 70% of these funds are designated for SME investments in energy-saving and green technologies. Eligible SMEs can also access grant support of up to 10% of their loan amount through the Small Business Impact Fund, financed by contributions from multiple countries, making these investments more affordable.
However, Albanian SMEs still have limited options for retail-facing institutions that could support local lending for green investments. The few green finance products offered by local banks are mostly related to energy savings in buildings (Dashi, 2023[36]). Generally, gaps in the financial infrastructure, including weaknesses in credit information systems and the absence of a private credit bureau continue to constrain banks’ ability to assess risk, contributing to cautious lending behaviour.
Regarding alternative debt instruments such as leasing, policies have been strengthened (see Cluster 1), particularly through the 2024 amendments to the licensing framework for non-bank financial institutions offering financial services. These changes have improved lenders’ capitalisation, transparency, and stability, as well as credibility of the leasing market. However, there are still no targeted measures to help SMEs use leasing as a tool to invest in sustainable and eco-efficient equipment. The widespread use of hire-purchase among European SMEs demonstrates the potential of this instrument to expand access to finance for Albanian firms. Strengthening leasing options could enable SMEs to pursue environmental objectives when upgrading technology and assets, while also supporting the circular economy, since leasing encourages lessors to prioritise the durability and sustainability of equipment.
In terms of risk-sharing mechanisms such as the credit guarantee mentioned in Section 3.3.1, public financial institutions play a vital role in promoting a sustainable banking environment for SMEs. However, there are currently no government-led initiatives to provide credit guarantees tied to greening objectives. Positively, though, public-private partnerships such as the EU4Innovation project aim to leverage public capital to attract private investment in sustainable start-ups whose products/services support the EU Green Agenda for the Western Balkans.
Market-based financing for SME greening is underdeveloped. Albania’s capital market shows little progress in attracting investor interest. Despite regulatory changes under the 2020 Law on Capital Markets, the securities market has seen limited progress. Operations are still limited to the trading of government securities and one corporate bond issued in 2023. Consequently, Albania has been slow to develop green bond schemes or securities linked to SME lending, tools that could enhance financing options, particularly for medium-sized enterprises, and improve market transparency. There are, however, plans to explore the creation of a dedicated SME segment on the Albanian Securities Exchange, potentially via a Multilateral Trading Facility (MTF),6 to improve access to funding for SMEs, which could well serve enabler and adopter SMEs that would like to issue minibonds to finance their green projects.
Concerning equity funding, some opportunities exist for sustainable SMEs to access financing among investment funds in Albania (see Cluster 1), but most funds have yet to explicitly integrate ESG criteria into their investment decisions. The equity capital market is making limited progress, as no private equity funds have been established to date. Nonetheless, the need to develop alternative financing channels for SMEs is recognised in the policy document, Creation of an Enabling Environment for the Development of Capital Markets in Albania (2023-2027), approved by the Council of Ministers in 2023.
Lastly, microfinance institutions remain indispensable in providing flexible credit to SMEs, particularly underserved segments of the economy, and account for around 7% of Albania’s total loan portfolio (Albanian Microfinance Association, 2024[37]). Yet, aside from agricultural lending, microcredit is not sector-specific and rarely supports climate-related investments. There is limited evidence of microfinance targeting climate adaptation, nature-based solutions, or post-disaster recovery, and sectoral usage data are scarce. While microfinance fills important financing gaps, its potential to support SME sustainability remains largely untapped.
The way forward
Create a national sustainable finance platform, or a similar co-ordination mechanism, to drive the development of national sustainable finance frameworks and facilitate engagement with the private sector, particularly industry, banking, academia, and civil society. This platform could, among other priorities, work towards developing a national taxonomy, continuing the standardisation of sustainable finance offerings and requirements, and advising the government on policies for strengthening SME access to sustainable finance, both through banks and alternative external financing mechanisms. It should also formulate initiatives to support capacities for SME sustainability reporting by providing targeted training and guidance in line with international standards (OECD, 2025[38]), such as the Voluntary Standard applied in the EU, particularly as data on environmental performance is increasingly expected by financial institutions and by supply chain partners subject to EU sustainability legislation. Inspiration can be drawn from the EU practice shown in Box 3.3.
Introduce targeted government financial incentives informed by systematically collected SME input. Albania still lacks key instruments that facilitate SME access to sustainable financing. In addition to developing green grant schemes, the new Albanian Development Bank could introduce concessional loans, based on lessons from donor-funded projects, to provide SMEs with favourable terms on loans such as subsidised interest rates and reduced collateral requirements in key sectors such as renewable energy, sustainable tourism or circular business models across industries. This could be done either directly, or indirectly by providing credit lines to commercial banks that then on-lend to SMEs. To inform the right policy design, AIDA could leverage insights gathered from SME feedback on financing and service needs.
Increase public-private partnerships for risk sharing. By collaborating with commercial banks, impact funds, multinational development banks and other investors, the government could combine public resources with private capital to de-risk high upfront investment costs of green projects. Such blended finance instruments should prioritise green initiatives and resilience-enhancing practices, such as circular business models and renewable energy projects. These kinds of partnerships would help reduce lending risks for financial institutions, encouraging greater participation in SME financing. Another approach could be the establishment of a green credit guarantee scheme, modelled on the one introduced in 2025 for agricultural lending or the manufacturing guarantee scheme implemented in 2024. The Association of Albanian Banks, together with the Ministry of Finance and Ministry of Economy and Innovation or the Ministry of Tourism and Environment could co-ordinate the creation of such a scheme.
About the platform
The Platform on Sustainable Finance, first set up in October 2020 and now in its third mandate, is an expert advisory body established under Article 20 of the EU Taxonomy Regulation to support the European Commission in developing and streamlining the EU sustainable finance framework to deliver on the aims of the EU Taxonomy Regulation, the Green Deal and the EU climate targets for 2030 and 2050.
The platform’s membership comprises world-leading sustainability experts from the financial, non-financial and business sectors, non-governmental organisations (NGOs) and civil society, academia and think tanks, individual experts, as well as public and international institutions.
Key functions
Under the newest mandate, the platform is guided by four priorities set by the Commission:
simplify and improve the coherence and usability of the technical screening criteria of the EU Taxonomy draft Delegated Acts (set out in the Omnibus package)
develop additional and revise existing technical criteria defining sustainable economic activities
track and report on sustainable investment flows
implement transition finance policies.
Notable achievements
In March 2025, the platform published the report, Streamlining Sustainable Finance for SMEs, which proposes a tailored streamlined approach, “the SME sustainable finance standard” for banks and other financiers to classify loans or other types of financing they provide to SMEs as sustainable (green or transition) finance and simplify any related voluntary reporting for SMEs, notably through the Voluntary Standards for SMEs, making it easier for them to respond to requests for sustainability information from large companies and financial institutions.
While the Bank of Albania and the European Investment Bank have begun work on a national taxonomy for sustainable business activities, developing a platform similar to the European Union’s would be highly beneficial. Such a system would harmonise definitions, align Albania’s financial sector with EU Taxonomy standards, and provide clear guidance to banks and SMEs. By streamlining classification and reporting, it would reduce transaction costs, stimulate innovation in green financial products, and create new opportunities for SMEs.
Source: European Commission (2025[39]).
Albanian SMEs and entrepreneurs face significant uncertainties related to the green transition and its market implications, particularly in energy, trade and access to funding for green investments. Limited awareness of alternative investment opportunities, challenges in adopting greener business practices, and difficulties in finding suitable collaboration partners are key barriers slowing progress (Albania Investment Council, 2023[40]).
Even when SMEs engage in business network initiatives, existing regulations, such as those governing how networks and clusters are formed and supported, often restrict access to supporting resources and limit value chain integration and resilience building. To address these challenges, it is crucial to establish a comprehensive non-financial support system that strengthens SME management capacities, provides guidance throughout the business lifecycle, and promotes sustainable business models and networking opportunities.
In this context, this section assesses the success of government support programmes in enabling SMEs’ green transition, as well as the policies put in place to encourage business-to-business ecosystems that boost SME resilience.
3.4.1. Scaling up public non-financial support for SMEs in a green and resilient economy
The current business support programme, BIDS 2021-2027, is not yet fully aligned with relevant government policies around the green economy. While the strategy outlines priority actions focussed on building a “competition-based entrepreneurship support scheme”, its key features lack measures to enhance business support that boost sustainable practices and resilience. Impact in this area, albeit less focussed on greening per se, was delivered through the joint Co-Solve-19 project with GIZ, launched in the wake of the COVID-19 pandemic and running until the end of 2023. Over 700 businesses participated in training programmes that offered personalised consultations and guidance, and more than 200 of these SMEs received grants directly supporting resilience building after the economic crisis.
Apart from this donor-supported project, a dedicated training sector within AIDA has not yet been established. Beyond measures targeting start-ups, no clear initiatives address the needs of scaling and growing enterprises, such as support for accessing capital, access to technology labs, or assistance with regulatory compliance, depending on the sector. At present, relevant support for SME innovators (see also Section 3.5) is mainly provided through the EU4Innovation programme, funded by the European Union, Germany and Sweden.
Public business support measures for SMEs in the green economy are now formally included in the National Strategy for the Development of Innovative Entrepreneurship 2024-2030 and its action plan, with provisions for technical and financial support programmes for start-ups and incubators focussed on the green sector. However, these commitments are still in the early stages of being implemented, and there is yet no reporting on targeted government support measures that facilitate SMEs’ transition to the green or circular economy.
While SMEs are formally involved in the planning and design of business support programmes through focus groups, their role in evaluation is generally limited to cases where they receive grants. Evidence of broader evaluation procedures during or after programme implementation remains scarce, with the government citing limited resources for conducting comprehensive assessments. In this context, it is also notable that no market research has yet been carried out on SME demand for green business support services (BSSs), including differences between SMEs acting as enablers (e.g. providers of green solutions, technologies or services) and those acting as adopters (e.g. firms integrating such solutions into their operations). This gap raises questions about the relevance and effectiveness of some existing measures.
Existing survey data on Albanian SMEs suggest that most businesses rely primarily on their own financial resources to develop green products and services, a pattern also observed in other WBT economies and the European Union (see Table 3.2). This could mean that external funding and green investment are either limited in availability or not fully utilised. Conversely, a lower proportion of firms appears to draw on their own technical expertise than the WBT and EU averages. Despite this, the share of SMEs in Albania benefitting from external support is comparable to that of WBT economies and the European Union. Albania's low reliance on external financial and technical assistance suggests that existing support services for greening may be insufficient, difficult to access or poorly tailored to SME needs. However, the survey results are not entirely representative.
Percentage of surveyed SMEs
Notes: The survey question was: “What type of support does your company rely on for the production of its green products or services?” [MULTIPLE ANSWERS], n = 105. Excludes answer options “Other” and “Don’t know/No answer”.
WBT data include Albania, Montenegro, North Macedonia, Serbia and Türkiye.
Source: European Commission (2024[6]).
AIDA has analysed training needs and prepared sectoral brochures to inform businesses in the tourism, manufacturing, and information and communication technology and business process outsourcing (ICT-BPO) sectors. However, the BSS portfolio does not outline specific sectoral priorities, and it is unclear which sectors receive the bulk of public support, including programmes related to the green transition. Greater transparency on this would help ensure that SME needs across sectors are addressed, whether through general information on sustainable and circular business models, basic ESG training, or more advanced forms of support. At the same time, despite the growing impact of climate-related risks, there is no systematic capacity building on disaster risk reduction. In addition, there are currently no dedicated BSSs focussed on long-term climate adaptation, nor are there initiatives that would strengthen business continuity and risk management for SMEs.
Finally, regarding private BSSs in Albania, there are currently no providers specifically targeting the transition of SMEs to a green and resilient economy. Government reports also note that co-financing mechanisms for private BSS are not operational, pointing to broader structural challenges in developing this source of support for SMEs. At the same time, businesses' awareness of private providers is reported to be generally low. The number of accredited private providers is not clearly established, and data on SME demand and satisfaction with such services are collected only infrequently. These gaps limit opportunities to expand and tailor the offer of greening and resilience-enhancing services.
3.4.2. Exploiting the power of networks for the sustainable growth of SMEs
Experience from OECD Member countries shows that targeted policies can successfully integrate SMEs into business networks,7 enabling them to benefit from knowledge transfer, innovation, internationalisation, and productivity gains (OECD, 2023[41]; 2019[42]; 2008[43]). In the context of the green economy, expanding and strengthening such networks is essential for SMEs to access key resources such as data, skills and technology, and to improve their adaptability and resilience (see Annex). For example, the Rhodes Co-Lab Sustainable Destination initiative in Greece brings together the regional and international networks of the TUI Group and the South Aegean Region, working closely with local business communities to support knowledge transfer and accelerate the green transformation of the tourism sector (South Aegean Region, 2022[44]).
In line with Albania’s overarching economic development strategy, the BIDS 2021-2027 and the National Strategy for the Development of Innovative Entrepreneurship 2024-2030, accelerating the shift toward a more innovation-driven, knowledge-based economy that generates higher-quality jobs remains a key government priority. This shift aligns with a broader global trend in which access to specialised knowledge is becoming increasingly essential. In this context, networks are becoming more important, as research shows collaborative firms are more likely to innovate.
Knowledge networks that link institutions and companies to share expertise, transfer skills and pool innovation resources are discussed further in Section 3.5.2. That said, strategic partnerships, which share traits with both production and innovation networks, are becoming more common. Government data show that the number of foreign and joint firms grew by 6% between 2021 and 2024, with the overwhelming majority of participating entities being SMEs (INSTAT, 2025[45]). The top two sectors experiencing the highest growth during these years were transport and storage (31%) and information and communication (26%). While much of this growth is due to the emergence of foreign firms, the presence of collaborative companies has also increased, with Albanian dominance in joint ventures rising by an average of around 14% yearly since 2022. This trend indicates a growing interest in collaborative business models.
Still, the regulatory environment for establishing business networks in Albania remains underdeveloped, which may contribute to uncertainty and caution, particularly among larger foreign firms, when considering collaboration with Albanian SMEs. In the area of industrial cluster development, for instance, there is still no solid legal framework, leaving most cluster initiatives to operate informally or under the structure of NGOs (European Commission, 2020[46]). On the business and donor side, efforts have been made to promote networking through associations and cluster formations. However, their sustainability has largely depended on continued donor support, while SME awareness of the benefits and opportunities of formal collaboration remains relatively low (European Commission, 2020[46]). In addition, these initiatives have generally been broad in scope and did not provide targeted support for SMEs aiming to contribute to the green or social economy.
As discussed in Section 3.1.2, Albania has only a small wood cluster comprising four SMEs, remaining the only formal grouping of its kind in Albania. There are no official data on the share of SMEs involved in professional networks or on their development, which limits understanding of how most SMEs are connected to other companies in pre- and post-production processes. Likewise, the reasons driving SMEs to collaborate, whether to achieve cost efficiencies, optimise operations, or create opportunities for productivity gains and innovation spillovers, remain largely unexplored.
While FDI has decreased in recent years from 7.7% of gross domestic product (GDP) in 2019 to 6.3% in 2023, it is still comparably high to other WBT economies and the European Union (1.3% in 2023) (World Bank, 2025[47]) and therefore, offers opportunities for SMEs to benefit from co-operation with larger foreign subsidiaries. However, this requires the government to take targeted measures to enable the development of networks, including with domestic companies, and to increase the absorptive capacities of SMEs, prioritising greenfield investments that are more likely to lead to direct benefit sharing between partners (Farole and Winkler, 2013[48]). So far, the government has not implemented a structured approach to promote the development of SME networks, although such an approach could offer many benefits for increasing their resilience and growth.
Although investor interest is increasing in key sectors such as renewable energy, transportation and manufacturing (Albanian Times, 2025[49]), areas with high potential and strong links to the economy’s decarbonisation efforts, there are currently no reported policies that actively promote economic diversification, nearshoring or regionalisation with a specific focus on green transition and resilience building.
Nearshoring presents an opportunity for Albania to attract investment into the decarbonisation of manufacturing processes, while better leveraging its largely untapped renewable energy potential to diversify beyond hydropower. At the same time, as companies increasingly factor environmental considerations into location decisions, strengthening the readiness of local SMEs to produce green goods and services will be critical to sustaining the competitiveness of the Albanian economy (González Pandiella and Maravalle, 2024[50]).
Between 2021 and 2024, AIDA implemented several initiatives under the BIDS framework to promote Albanian businesses abroad and connect interested investors with local firms. However, concrete data on the success of these investment projects, including the number of partnerships and networks created and the volume of investment generated through the three campaigns conducted, are not available. Other measures aimed at strengthening networking among domestic firms have focussed primarily on building a start-up ecosystem but have not included concrete incentives to promote synergistic business models.
While AIDA’s efforts are notable, there remains a significant gap in linking network-building activities to initiatives that enable SME greening. Looking ahead, strong synergy potential is expected with the Smart Specialisation Strategy (S3), which outlines activities to develop a place-based knowledge economy and anticipates further support schemes for network development in key sectors. For example, the expansion of renewable energy is expected to attract more investors, foster co-operation between firms and facilitate cross-border collaborations within the region. These effects, however, are projected to materialise primarily from 2027 onward.
In other sectors, such as recycling, which are inherently network-based, expanding collaboration and resource sharing could help Albania address key circular-economy challenges, including the underuse of recycling capacity alongside high pollution rates (OECD, 2024[9]; European Commission, 2025[51]). Similarly, in the bioeconomy, a stronger regional focus on the sustainable use of biomass and agricultural waste, combined with the engagement of local stakeholders, shows significant potential for networks to drive impact through standardisation efforts and the uptake of sustainable, circular biomaterials across value chains (Interreg, 2025[52]).
The way forward
Establish a dedicated training unit within Albanian Investment and Development Agency and deliver SME green capacity-building programmes. The government should ensure that AIDA has sufficient capacity to implement training initiatives focused on greening and resilience for SMEs in line with its goal to establish a responsive training sector in the organisation. This would support the effective implementation of business support measures set out in the National Strategy for the Development of Innovative Entrepreneurship 2024-30. Before formulating its training programme, AIDA should undertake market research on SME demand for BSSs related to the green economy.
Tailor green support measures to SME size, age, sector and role in the green transition (i.e. innovator, enabler and adopter SMEs). Most of AIDA's support services target start-ups, but there are no clear initiatives to address the needs of scaling and growing innovator and enabler SMEs. Support for adopters could also be expanded. Hence, support measures should be adapted to address these differences and respond to the distinct needs of enterprises at different stages of development, recognising that start-ups, scaling firms and mature SMEs face unique challenges in preparing for a successful green transition and building resilience. In designing such measures, Albania could draw on the latest OECD categorisation of SME support instruments and related good practices (OECD, 2025[34]).
Develop a solid legal framework for cluster development. Most clusters in Albania remain informal or operate as NGOs. The government may consider establishing a cluster-specific regulatory framework to provide greater operational certainty for members. This would address existing barriers to supporting SME development in key sectors and create an environment conducive to cluster growth, aligned with the S3's green priorities.
Adopt a structured approach to promote SME network development. Incoming FDI, particularly in light of planned green industrial parks in the medium-term (see Section 3.1.2), could be used to foster these networks. For this, AIDA could use its expertise in connecting SMEs with international partners and exploring nearshoring opportunities. Such networks should focus on engagement with key export markets to enable knowledge exchange, joint participation in green projects, and integration into sustainable value chains, enhancing SME competitiveness through spillovers.
Research and development (R&D) with a strong focus on innovation are critical for SMEs to enhance competitiveness by boosting productivity, accessing new markets and reducing long-term costs. In the context of the green economy, innovation also helps to reduce resource use through circular-economy practices and scale climate-friendly solutions that prioritise resilience.
However, the innovation capacity of Albanian SMEs has been declining. Since 2017, the share of SMEs introducing innovations has fallen by 9 percentage points (p.p.), while collaborative innovative activities have dropped by 27.5 p.p., largely due to weak collaboration infrastructure (European Commission, 2024[53]). In response, the Albanian government is placing increasing emphasis on fostering innovation and knowledge-based development within targeted SME policies.
Hence, this section examines how well government strategies are translated into advanced innovation infrastructure, effective incentives and strengthened SME knowledge networks that enable sustainable transformation.
3.5.1. Advancing strategic innovation for a green and resilient economy
Albania’s innovation policy is mainly shaped by the National Strategy for Scientific Research, Technology, and Innovation (2023-2030) and the National Strategy for the Development of Innovative Entrepreneurship (2024-2030), together aiming to build synergy between strengthening scientific research and increasing R&D capacity while enabling innovative SMEs and start-ups, including those engaging in green and resilience-enhancing innovation, to increase value. While the former strategy’s action plan promotes technology transfer and collaboration between research institutions and the private sector, no progress reports have yet detailed how SMEs have benefitted from the measures as implementation is in its early stages.
Other strategies, such as the BIDS 2021-2027, aim to foster a knowledge-based SME market through targeted support for start-ups, international integration, and entrepreneurial learning in the context of the green transition. Completed activities within the implementation phase 2021 to 2024 include the Technology and Innovation Project Financing Programme implemented for the first time in 2023 by the National Agency for Scientific Research and Innovation (NASRI), which aims to enable business-academia collaboration. While concrete data on the share of greening or resilience-focussed projects with SMEs are unavailable, 28 projects were supported over the last two years, and the state budget dedicated to the initiative tripled in 2024. While the BIDS acknowledges the importance of SME innovation, its action plan lacks concrete measures for SMEs across priority sectors for the green transition.
Another strategy worth mentioning in this respect is the S3 for 2024-2030, which outlines measures across three priority areas: renewable energy and natural resources; sustainable tourism; and sustainable food systems, all of which align with the country’s 2050 net-zero goal. The S3 foresees support for business investment in renewable energy innovation, tourism service diversification, and sustainable agri-food practices, but details on implementation targeting strategic collaborations and other activities to enhance innovation capacities in SMEs remain limited.
SMEs in Albania have had relatively limited opportunities to contribute to the development of innovation policies. Additionally, key performance indicators for monitoring progress in green innovation, particularly its impact on SME productivity, are not yet fully established, and co-ordination between multiple institutions involved in innovation policy also poses a challenge. While SMEs participated in the consultation process for the National Strategy for Scientific Research, Technology, and Innovation 2023-2030, current strategies, including this one, could further strengthen their links to enhancing SME resilience to economic shocks and climate-related challenges. This suggests room for improving how innovation measures support business continuity.
In this context, the Investment Council has regularly produced technical research papers, including SME surveys and consultations, to analyse the relationship between innovation and productivity in SMEs. However, these efforts have focussed primarily on the energy sector rather than the broader green economy. The findings nevertheless indicate a significant decline in the share of companies committed to innovation compared to 2021. In 2024, only 45% of businesses reported paying substantial attention to innovation, down from 73% in 2021. At the same time, the proportion of businesses not prioritising innovation at all rose from just 4% in 2021 to 21% in 2024 (see Figure 3.4). According to the Investment Council, entrepreneurs and firms continue to face difficulties in allocating sufficient resources and funds to research and innovation.
Percentage of surveyed SMEs
Notes: The survey was conducted between January and February 2024. The question was: “What place does the development and introduction of innovation occupy (how much attention is paid to it) in your company?” Sample size: n = 601; 99% of respondents were SMEs.
Source: Albania Investment Council (2024[54]).
In this regard, it is notable that targeted innovation incentives are yet to be introduced, apart from the 2023 Law on Income Tax, which provides temporary benefits, until the end of 2025, for companies engaged in certain “innovative” activities, such as software development. Beyond this measure, there is currently no broader incentive framework to support R&D investments or to cover the costs associated with innovative processes in SMEs.
Regarding capacity building, Albanian SMEs have access to the services of more than 15 accelerator and incubator organisations. While none of these institutions is exclusively dedicated to green or resilience-focused SME innovation, some, such as the INNVEST incubator, aim to foster a culture of sustainable innovation across sectors like ICT, tourism and agriculture. Other initiatives, such as the Yunus Social Business accelerator and incubator, support SMEs in scaling solutions that enhance social impact, including addressing environmental challenges and resilience projects. Public sector involvement in this space remains limited, but partnerships with local institutions and universities are gradually emerging. The government has also announced plans to establish a dedicated fund to certify and finance incubators, including at least five Startup Albania services with a focus on green and digital sectors in 2024. However, the status of these efforts is not yet known. Finally, the Albanian Chamber of Commerce notes that while entrepreneurship centres exist in the economy, support must be scaled to reach smaller firms and start-ups that would need their services.
At present, the Ministry of State for Entrepreneurship and Business Climate operates a grant scheme targeting businesses younger than six years and self-declared start-up facilitators. In the 2025 call, compared to the 2024 round, an additional incentive was introduced: applicants applying in partnership with registered facilitators received an extra 5% in evaluation points, thereby strengthening the role of facilitators in SME development. However, no data have been published on the grant scheme’s budget or on the enterprises awarded in recent years. Moreover, green criteria are not integrated into these grant schemes, meaning SMEs without green business models are not directly encouraged to adopt more sustainable practices. A further gap lies in the lack of follow-up support to connect early-stage SMEs with additional financing once initial grant funding is exhausted.
Finally, concerning the intellectual property (IP) framework, important progress has been made through the adoption of a dedicated Law on Trademarks in 2025. This reform brings Albania closer to EU standards and introduces clearer rules for registration, transfer and licensing. It also strengthens IP protection and enforcement, which can further enable SMEs to invest in innovation, safeguard (green) brands, scale their businesses and compete more effectively both domestically and in the EU market.
Still, the potential of IP to support SMEs in building a green and resilient economy has not yet been fully acknowledged in national strategies and policies. The General Directorate of Industrial Property provides general IP services and training for SMEs through the IP4Startups programme, supported by the Albanian-Swiss Intellectual Property Project. However, this programme offers personalised support to only ten start-ups, making its reach too limited to drive broader adoption of IP strategies for sustainable growth. Some procedural simplifications, such as streamlined processes for resolving trademark disputes and the availability of priority examination for SME filings, are in place; still, overall support for leveraging IP as a driver of sustainable innovation remains modest.
3.5.2. Capitalising on knowledge networks for driving SME innovation
To navigate the challenges posed by the global megatrends outlined in Section 3.1, SMEs must actively engage in knowledge and innovation networks. Their integration into resilient networks is crucial for long-term value creation and growth. The rise of open innovation has also made it easier for SMEs to access resources from universities and research institutions,8 which are vital for technology transfer.
Access to knowledge and data through networks can help SMEs overcome capacity gaps (Pourmand Hilmersson and Hilmersson, 2021[55]). Voucher schemes can promote such co-operation between SMEs and R&D providers, but the responsible agency, Startup Albania, established in late 2023, has not yet launched such a programme. It has, however, conducted an awareness campaign to promote Albanian SME participation in the Horizon Europe-funded Innovation Vouchers pilot for the Western Balkans, which specifically targeted green and digital SMEs. Still, to date, none of the funds operated by AIDA explicitly focus on fostering business-academia co-operation.
Albania has recently marked a milestone by establishing its first institutional infrastructure to support strategic knowledge and innovation partnerships between SMEs and research institutions (see Cluster 1). The Durana Tech Park, opened in April 2025 and strategically located between the capital Tirana and the port city of Durrës, is the economy’s first science and technology park. While it prominently features sustainable development objectives, it does not operate as a dedicated green technology or industrial park. Further, four scientific and technological information centres have been established at universities across the economy, and the government is working with World Intellectual Property Organization experts to set up the first technology transfer office (TTO), initially planned for 2025. However, beyond the existing agriculture-focused TTOs located in Fushë-Krujë, Lushnja, Vlorë, Korçë, and Shkodër, there are currently no additional TTOs to systematically foster collaboration between academia and SMEs.
Regarding technology-extension services, efforts to improve SME access to resources for collaboration with research institutions were partly driven by the NASRI call for joint projects between companies and universities, which has been running since 2022. Between 2023 and 2025, a total of 42 projects benefitted from these calls, 12 of which focussed on environmental or climate issues. However, SME participation is not very high (National Agency for Scientific Research and Innovation, 2025[56]).
In terms of fostering green and resilience-enhancing innovation through academia-industry partnerships, however, there have been some notable initiatives driven by donors, the private sector and local actors. One example is the Circular City Labs in Tirana, which brings together municipal authorities, businesses, academia, and civil society (see Box 3.4).
Policy context
With growing population density, restaurants, businesses and industry, cities are generating increasing amounts of waste. Reusable packaging systems are emerging as a key solution to advancing the circular economy, preserving resources while creating profitable opportunities for innovators. To support Albania’s transition toward an innovation-driven, circular and knowledge-based economy, the Municipality of Tirana is piloting such systems. This effort is backed by the European Union, Germany, and Sweden through three initiatives: 1) the Circular City Labs Project; 2) EU for Circular Economy and Circular Economy for Sustainable Urban Development; and 3) the EU4Innovation programme.
Operational aspects
The programme is implemented by a consortium of three local entities: Destil Creative Hub, Co-PLAN, and POLIS University. Circular City Labs (CCL) – Tirana engages local businesses in sectors such as hotels, restaurants and cafés (HoReCa), retail and grocery, e-commerce and information technology, logistics, and event management, as well as start-ups, entrepreneurs, city administration, academia, and civil society.
A maximum of 20 teams took part in an intensive hackathon, with selected participants entering a four-month accelerator programme from June to December 2024. During this phase, they received one-on-one mentoring, access to POLIS University facilities, piloting opportunities, financial and marketing support, and networking activities. The programme culminated in a Demo Day on 10 December 2024, where nine start-ups and business ideas were showcased. These moved into the final piloting and monitoring phase between January and May 2025.
Impact
By July 2024, 12 CCL–Tirana SMEs and start-ups (majority early-stage start-ups and small technology-oriented firms) were actively developing green and digital solutions to address Albania’s circular-economy challenges. Most of the solutions remain at the pilot or prototype stage, with several participants exploring opportunities for further development through partnerships with municipalities, private companies and international support programmes. Full commercialisation of these solutions is still in progress and comprehensive data on market uptake is not yet available.
Source: Circular City Labs – Tirana (n.d.[57]).
The establishment of the European Institute of Innovation and Technology (EIT) Hub in Tirana in early 2025 is further strengthening technology-extension services for SMEs in Albania. The EIT Hub functions as a knowledge and innovation community, linking businesses with research and educational institutions as well as regional actors across Albania and the wider European innovation ecosystem. Supported by the EU4Innovation project, its mandate is to accelerate Albania’s economic transformation toward an innovation-driven and knowledge-based economy.
In addition, as noted in Section 3.5.1, the co-operative grant scheme under the Technology and Innovation Project Financing Programme, administered by NASRI since 2023, provides another channel of support. However, this government-run programme has not yet been sufficiently evaluated to assess its concrete impact on business resilience or its effectiveness in helping SMEs integrate into sustainable value chains and expand through trade. Improvements in this area could be advanced through the forthcoming Law on the Promotion of Innovation, currently in its initial drafting stage, which is expected to establish clearer mechanisms for financial support, introduce targeted technical and financial incentives, and create a more enabling environment for innovation in strategic sectors such as digitalisation and the green economy.
The way forward
Establish a comprehensive incentive system for green research and development and innovation. In line with the forthcoming Law on the Promotion of Innovation, which will provide a legal basis for financial, tax and technical incentives to support innovative activities, the government is encouraged to develop a balanced policy mix that addresses both supply- and demand-side measures. This mix could target strategic sectors such as green energy, agriculture, and tourism (Council of Ministers, 2024[58]) to foster low-carbon and resilient SME development, while balancing support for sectoral growth with the needs of a complex innovation system.
Rapidly implement and begin monitoring the announced funding for green and digital innovation under the National Strategy for the Development of Innovative Entrepreneurship. Based on AIDA’s forthcoming needs assessment, the government should promptly develop the five announced services focussed on technical and financial capacity building for start-ups and the incubator, thereby enhancing public involvement and support within the innovation ecosystem.
Conduct systematic evaluations and impact assessments of SME innovation support measures. The government should strengthen monitoring and evaluation mechanisms for innovation support schemes aimed at enhancing SME greening and resilience. In particular, the link between such measures and productivity gains should be analysed to inform evidence-based policymaking. This would help demonstrate the benefits for SMEs, for example, through the existing co-operative grant schemes under the Technology and Innovation Project Financing Programme administered by NASRI since 2023. Key indicators the government could use to assess environmental and material productivity include SME energy consumption levels and intensity; greenhouse gas emissions (both total and by business sector); and the energy cost burden relative to firm revenues (OECD, 2023[59]).
Introduce a green innovation voucher scheme. Albania has yet to implement an innovation voucher scheme, although such an instrument is referenced in the BIDS 2021-2027. Launching such a programme, focussed on the green transition, would enable open innovation among SMEs, research institutions and other stakeholders, helping businesses strengthen their resilience and advance eco-innovative solutions to the challenges of the green transition. A good practice example is presented in Box 3.5.
Policy context
SME:Green is an EU-funded voucher scheme for advice and investment, aimed at a wide range of SMEs in Denmark. The voucher scheme focusses on helping companies that want to change and develop, with a particular emphasis on the green transition and on reducing their resource consumption and waste volumes.
Operational aspects
There are eight vouchers available, which can be either individual investment or consultancy vouchers, or combined. The smallest voucher has a value of DKK 50 000 (Danish kroner) (~EUR 6 700), while the largest combination voucher has a value of DKK 300 000 (~EUR 40 000), with both investment and consultancy vouchers amounting to DKK 150 000 (~EUR 20 000) each. Further:
Duration: September 2022-December 2026 (companies must have completed their project by 1 October 2026)
Total budget: DKK 100 million (~EUR 13.4 million)
EU funding: DKK 80 million (~EUR 10.7 million).
Policy impact
Denmark’s SME Green Voucher Scheme is part of a nationwide Business Programme for SMEs, implemented through six inter-municipal business centres. While specific results from the green vouchers are not yet available, over 5 000 SMEs have already benefitted from grants supporting advisory services and investments across various programme areas.
Albania would greatly benefit from introducing such a voucher, which would promote cross-sectoral collaboration within the innovation ecosystem and make the green transition more economically viable for SMEs and their partners.
Source: Danish Business Authority (n.d.[60]).
Networks play a major role in increasing resilience as a certain degree of redundancy and diversification across nodes helps to reduce interdependence, promote risk management culture, reduce the cost of shock mitigation and allow for easier recovery and adaptation (Brende and Sternfels, 2022[61]; OECD, 2004[62]; OECD, 2023[63]). SME networks can take different forms comprising various actors that exchange products, services, knowledge, and other resources. They can be divided into four main types, with the according typology illustrated in Figure 3.A.1 below.
Sources: Based on OECD (2023[2]), drawing on EC/OECD (2023), Unleashing SME Potential to Scale Up, https://www.oecd.org/cfe/smes/sme-scale-up.htm, Phase II on Network expansion; EC/OECD (2023), Fostering FDI-SME Ecosystems to Boost Productivity and Innovation, https://www.oecd.org/industry/smes/fdi sme.htm, Phase II on FDI-SME linkages and ecosystems.
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← 1. In 2024, exports to EU countries represented 72% of Albania’s total exports (INSTAT, 2025[64]).
← 2. The United Nations Joint Programme funded by the Swedish Government produced the assessment of the textile and footwear sector’s regulatory alignment with EU standards within the frameworks of the Business Partnerships and Solutions for Sustainable Development Goals (SDGs) project. The project aims to support private sector partners in Albania to integrate the SDGs in their business models, thus directly supporting the economy’s efforts to contribute to the Agenda 2030 for Sustainable Development (Kacani and Bayoumi, 2023[65]).
← 3. The ESPR entered into force on 18 July 2024. It aims to significantly improve the sustainability of products placed on the EU market by enhancing their circularity, energy performance, recyclability and durability. Priority product groups to be targeted by upcoming ecodesign requirements include, among others, clothing and footwear, iron and steel, and chemicals, with the first implementing measures expected from 2026. The ESPR will apply to all products placed on the EU market, regardless of whether they are produced within or outside the European Union.
← 4. Between March 2023 and August 2028, the EU-funded IPA CARE Programme will support all Western Balkan economies and Türkiye in developing capacities for disaster risk management. Concretely, the focus will be on increasing resilience to earthquakes and health emergencies. It has a budget of EUR 12.8 million, of which 36% will be devoted to equipment (IPA CARE, n.d.[66]).
← 5. In 2024, the Council of Ministers approved the operational details of a state guarantee scheme for the processing industry, following amendments to the 2024 budget which allocated ALL 4 billion to this instrument. The scheme enables firms in the sector to access bank lending under preferential conditions to support investments in production line automation, as well as to secure liquidity for the purchase of raw materials. The guarantee covers up to 70% of loan values, with interest rates capped at no more than 1.5% above the base rate. Repayment periods extend up to seven years for investment loans and up to three years for working capital loans related to raw material purchases. Firms could apply until October 2024 for a loan under this scheme.
← 6. The Financial Supervisory Authority of Albania approved, by Board Decision No. 88, dated 31 May 2023, the Regulation “On the licensing and operation of multilateral trading facilities (MTFs), organised trading facilities (OTF), and requirements for brokerage firms acting as systematic internalisers”. Its purpose is to define the requirements and procedures for licensing the operation of an MTF or an OTF, the organisation and operation of the MTF or OTF, and the criteria for treating/barring brokerage firms as systematic internalisers.
Compared with regulated markets, MTFs tend to be more accessible for smaller companies. Across different regions, MTFs and other specialised SME equity platforms have been developed as both an alternative and a stepping stone to main exchange listings. They typically offer more flexible listing criteria, lighter disclosure requirements and lower admission costs, reflecting the specific needs and characteristics of SMEs (OECD, 2015[67]).
← 7. Networks are systems of connected actors that enable the exchange of information, products, services, assets and/or resources. They may be supported by physical infrastructure, formal agreements, or remain informal relationships (OECD, 2023[2]).
← 8. This assumes that governments take deliberate policy efforts to improve the capabilities of small businesses, as innovation activities otherwise tend to be concentrated among larger, leading firms and sectors due to economies of scale and knowledge spillovers (OECD, 2025[68]).