Western Balkans faces economic disparities and money laundering risks

Economic reports highlight contrasting trends in the Western Balkans, specifically regarding Albania's income levels and regional challenges with money laundering.

According to IMF data, Albania has risen to third in the region for nominal GDP per capita at $11,200, following Serbia and Montenegro. However, when adjusted for purchasing power parity (PPP), Albania drops to fourth place, trailing Montenegro, Serbia, and North Macedonia, indicating a high cost of living relative to income.

A report by the Global Initiative Against Transnational Organized Crime (GI-TOC) titled “Licence for Money Laundering” warns that money laundering remains a significant issue across Albania, Bosnia-Herzegovina, Kosovo, Montenegro, North Macedonia, and Serbia. The report notes that in Albania, there is a perception that laundering money through luxury hotels and real estate brings necessary capital into the economy, despite the legal risks. The study identifies weak institutional support and the role of legal and financial professionals in exploiting regulatory loopholes as key drivers of illicit financial flows in the region.