Over the past two decades, Albania has faced many social and economic changes, since it changes it economic system from a centralized one to a democratic one in early 90s. During this transitory phase, Albania had faced difficult challenges such as of undertaking all the necessary reforms for the stabilization, liberalization, privatization and integration of its economy in the overall global and regional economic trends. The first aim of this paper is to study the Albania Economy in its democratic era. The second aim of this paper is the identification of the main drivers to economic growth in the Albanian case during past two decades and the challenges that it faces today. Furthermore, this paper deals with some of the challenges that Albanian economy faces today such as SMEs challenges that represent the 98% of the market, rail infrastructure, lack of entrepreneurship, low level of innovation spirit among the enterprises, lack of focus in R&D.
This paper finds out that Albanian Economy has performed well but yet, there exists some critical challenges that should be face in order to achieve the desired level of economic development and competitiveness in global and regional market
