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The Albanian Pension System: The Need for Reform

Author

Listed:
  • Areti Stringa

    (University Tirana, Faculty of Economy)

  • Raimonda Duka

    (University Tirana, Faculty of Economy)

  • Kiti Stringa

    (Bocconi University)

Abstract

This paper focuses on the pensions system in Albania. The economic, political, and social changes that occurred in the nineties put the whole country’s economic development under pressure and especially the pension system. This paper analyzes how the challenges brought by both the demographic transition and the economic transition were faced. It discusses the different reforms undertaken up to now and their impact on the pension system sustainability, equity, and the fiscal burden to the state. The parametric reforms of 2002 had a positive effect on the financial situation of the pension scheme. Yet further reforming of the current scheme is necessary to address ongoing concerns. The high rate of unemployment and the informal labor market reduce the amount of contributions. The “aging” population, which increases the fiscal burden, continues to challenge the pension system.

Suggested Citation

  • Areti Stringa & Raimonda Duka & Kiti Stringa, 2011. "The Albanian Pension System: The Need for Reform," EuroEconomica, Danubius University of Galati, issue 29, pages 97-108, August.
    • Handle: RePEc:dug:journl:y:2011:i:29:p:97-108
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    File URL: http://journals.univ-danubius.ro/index.php/euroeconomica/article/view/985/821
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    References listed on IDEAS

    as
    1. Jan Svejnar, 1996. "Pensions in the Former Soviet Bloc: Problems and Solutions," William Davidson Institute Working Papers Series 14, William Davidson Institute at the University of Michigan.
    2. World Bank, 2009. "Pensions in Crisis : Europe and Central Asia Regional Policy Note," World Bank Publications - Reports 18728, The World Bank Group.
    3. Landis MacKellar & Robert Holzmann & Jana Repansek, 2009. "Pension Reform in Southeastern Europe : Linking to Labor and Financial Market Reforms," World Bank Publications - Books, The World Bank Group, number 2587, April.
    4. World Bank, 2007. "Albania - Urban Growth, Migration and Poverty Reduction : A Poverty Assessment," World Bank Publications - Reports 7659, The World Bank Group.
    5. Mukesh Chawla & Gordon Betcherman & Arup Banerji, 2007. "From Red to Gray : The "Third Transition" of Aging Populations in Eastern Europe and the Former Soviet Union," World Bank Publications - Books, The World Bank Group, number 6741, April.
    6. Robert Holzmann & Edward Palmer, 2006. "Pension Reform : Issues and Prospects for Non-Financial Defined Contribution Schemes," World Bank Publications - Books, The World Bank Group, number 6983, April.
    7. Mr. Volker Treichel, 2001. "Financial Sustainability and Reform Options for the Albanian Pension Fund," IMF Working Papers 2001/047, International Monetary Fund.
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