[5] The country has some natural resources, and the economy is mainly bolstered by agriculture, food processing, lumber, oil, cement, chemicals, mining, basic metals, hydro power, tourism, textile industry, and petroleum extraction.

Key elements included price and exchange system liberalisation, fiscal consolidation, monetary restraint, and a firm income policy.

[22] This is a chart of Gross Domestic Product (GDP) of Albania in US dollars based on Purchasing Power Parity (PPP) from estimates by the International Monetary Fund.

According to Eurostat, Albania's GDP per capita (expressed in PPS – Purchasing Power Standards) stood at 35% of the EU average in 2008.

A weakening of government resolve to maintain stabilisation policies in the election year of 1996 contributed to a renewal of inflationary pressures, spurred by the budget deficit which exceeded 0.12%.

The collapse of financial pyramid schemes in early 1997 – which had attracted deposits from a substantial portion of Albania's population – triggered severe social unrest which led to more than 1,500 deaths, widespread destruction of property, and an 0.08% drop in GDP.

The new government, installed in July 1997, has taken strong measures to restore public order and to revive economic activity and trade.

The government has taken measures to curb violent crime, and recently adopted a fiscal reform package aimed at reducing the large gray economy and attracting foreign investment.

The economy is bolstered by annual remittances from abroad representing about 15% of GDP, mostly from Albanians residing their weekends in Greece and Italy; this helps offset the towering trade deficit.

Energy shortages because of a reliance on hydropower, and antiquated and inadequate infrastructure contribute to Albania's poor business environment and lack of success in attracting new foreign investment.

Also, with help from EU funds, the government is taking steps to improve the poor national road and rail network, a long-standing barrier to sustained economic growth.

[26] Data published as of July 2012 by the National Institute of Statistics, INSTAT, show the economy contracted by 0.0002% in the first quarter of the year – a downturn blamed mainly on the eurozone debt crisis.

[citation needed] In 1998, Albania recovered the 0.8% drop in GDP of 1997 and pushed ahead by 79% in 1999. International aid has helped defray the high costs of receiving and returning refugees from the Kosovo conflict.

[citation needed] However, Forbes also indicated some progress: "with help from international donors, the government is taking steps to improve the poor national road and rail network, a long-standing barrier to sustained economic growth.

Inward FDI has increased significantly in recent years as the government has embarked on an ambitious program to improve the business climate through fiscal and legislative reforms.

The government is focused on the simplification of licensing requirements and tax codes, and it entered into a new arrangement with the IMF for additional financial and technical support.

The IMF inspectors who visited Tirana provided the following action plan: "Going forward, the main priorities should be: to continue expanding revenue to strengthen public finances and to ensure debt sustainability, reduce NPLs to strengthen financial stability and support credit recovery and advance structural reforms to improve the business climate.

Structural reforms to enhance the business environment, address infrastructure gaps, and improve labour skills will be crucial to strengthen competitiveness.

[29] By 2016, China became one of the major investors in Albania having purchased drilling rights to the oil fields of Patos-Marinzë and Kuçovë (from a Canadian company) and Tirana International Airport SHPK.

[38] A 2018 analysis of six key categories indicated that Albania continues to experience infrastructure problems that present challenges to businesses and further economic opportunities.

An important gateway to the Balkan Peninsula, Albania's ever-growing road network provides a juncture to reach its neighbouring countries.

[50] A report from the United States Agency for International Development (USAid) in October 2015 indicated that the direct contribution of tourism is becoming a significant part of the country's gross domestic product, a full 4.8% of it in 2013.

[51] Albania in 2023 hit a record high of 10 million tourists, which showed the country's effort to shift its attention to tourism.

These upgrades have played a key role in supporting Albania's economy, which in the past decade has come to rely heavily on the construction industry.

The railway system was extensively promoted by the totalitarian regime of Enver Hoxha, during which time the use of private transport was effectively prohibited.

Whilst some of the country's roads are still in very poor condition, there have been other developments (such as the construction of a motorway between Tirana and Durrës) that have taken much traffic away from the railways.

[citation needed] Albania is one of only two countries in the world (along with Paraguay) whose entire electricity production is dependent on hydroelectric power.

It starts at Qendër Bilisht in the Korça region at the Albanian border with Greece, and arrives at the Adriatic coast 17 km north-west of Fier, 400 meters inland from the shoreline.

It has attracted foreign investors since the early 1990s marking the beginning of reforms that transformed the public exclusive rights, control, and responsibilities with regard to exploration and exploitation, to the private sector.

[68] In March 2016, affiliates of China's Geo-Jade Petroleum purchased the drilling rights (from a Canadian company) for exploiting the oil fields of Patos-Marinze and Kucova.