Albania: A Reliable Outlet for Produce Doubles Productivity

February 5, 2007

LUSHNJE, Albania - When Kodhel Verga first started selling green peppers, trading was a crime. A truck driver in the Albanian army, he used to transport sacks of produce on the sly, hiding the weights for his scales inside the cavity of peppers. He continued selling vegetables when communism collapsed and eventually dropped his low-paying army job to trade full-time. Verga would mount one sack of produce on the handlebar of his bicycle, load two on the back and cycle down dirt paths selling tomatoes and squash to his neighbors.
Today Verga, 39, shares two minivans with his brothers. He brings the bountiful Mediterranean produce of Lushnje, neatly packed in plastic cases, to the market of Korca, 250 km away in eastern Albania where the weather is colder and the growing season kicks in later.

Verga’s happier circumstances reflect the transformation of Albania’s market economy from illegal to grey and finally, in the last few years, to something more open and organized. The transition is particularly visible in the agricultural sector where a World Bank loan to the Albanian government has helped fund the country’s first professionally-organized fruit and vegetable markets.

The first market funded by the Agricultural Services project was established in Lushnje, a town in Albania’s most fertile valley, southwest of the capital city of Tirana, close to the Adriatic sea. Although the market was opened only two years ago, business is so brisk that it is already expanding to keep up with demand for stalls and parking spaces. A second market opened in Korca last year and two other markets, in Shkodra in Albania’s mountainous north and in Vlora on the coast, are under construction.

A reliable outlet for produce triggers a rise in productivity

In Lushnje, farmers have found a reliable outlet for their produce, eliminating the need to drive for hours looking for buyers scattered in different towns and ridding them of the fear that what they grow would not sell. Since the market opened, production in the area has doubled both in open fields and in the hundreds of new greenhouses that have cropped up in no time.

“We expected production to grow but not so fast,” says Enkes Shundi, a market specialist working on the Agricultural Services project. As the quantities have increased, so have the diversity and quality of the produce on sale.

On a bustling early summer day, evidence of progress is all around. Take Trifon Stambolliu, for example, the president of a farmer’s association in the Lushnje region, a former military officer laid off in the restructuring of the Albanian army in 1995. Before the creation of a central market, Stambolliu grew only one crop (cucumbers). Only 6% of his small plot of land was covered in greenhouses; now a third of his land is covered by them. He grows cucumbers but also tomatoes, melons, cauliflower and salad.

“My production has increased tenfold,” says Stambolliu, 49, “partly because I use better technology but mostly because I now have a place to sell.”

Organizing trade along clear lines

In the past, Stambolliu and other local farmers gathered near a stadium in Lushnje. “We would sell our produce straight out of a van. It was muddy in the winter and dusty in the summer,” he recalls. “I was the first to sign a contract to rent a stall here,” he notes proudly. The new market is paved and divided in clear sections. A light roof provides shade that helps produce stay fresh longer.

The Lushnje market was created more than 10 years after the collapse of communism and the demise of planned agriculture. It fills an important gap in the country’s infrastructure. Under the old regime, produce went from cooperative farms to storage facilities in the cities and into a network of shops. Everything - down to the price, type and quality of products - was controlled by the state, with the usual shortages and deficiencies that plagued centrally planned distribution systems elsewhere.

The state-run warehouses were abandoned and destroyed after 1991. Land was distributed in small parcels. Rural Albanians received an average 1.5 hectares of land (or 3.7 acres, about the size of two soccer fields) which the newly independent farmers cultivated with primitive means mainly to feed their families. Excess production was sold in a chaotic fashion, with farmers wasting much of their time looking for traders and traders driving rough back roads in search of produce.

“We created a new mentality,” says Agim Shehu, the Albanian director of the Agricultural Services project. “Farmers and traders would not have been able to create organized markets with standardized rules spontaneously.” Lushnje is run by a well-respected director who collects set fees from farmers and traders. Those proceeds will be used for the market's expansion.

Setting higher standards for export

Shehu and his team are working now to improve the efficiency of the new markets, by increasing the flow of information. Wholesale prices fetched at Lushnje and Korca are distributed to retail shops by email, preventing traders from hiking up prices too much and gouging consumers.

The market director at Lushnje also holds seminars to inform farmers of the demand for fruit for example and orient their production in sensible ways. Other efforts are being made to better package and label produce for export. In time, a market like Lushnje could assemble the volume and quality of produce necessary for mass export to neighboring countries like Italy.

Traders from Kosovo, Macedonia and Montenegro show up regularly at the market. Stambolliu also met a Dutch exporter there. His tomatoes are now being eaten as far away as England, Holland and Russia, he says. Not bad for an accidental farmer with 1.8 hectares of land.

* * *

This progress was made possible thanks to the Albania Agriculture Services Project (2001-2007).

Initially published in July 2005