Speeches & Transcripts

Property compensation still pending, keeping hostage investments

March 12, 2012

Kseniya Lvovsky, World Bank Country Manager Gazeta Shqiptare Albania


Interview of Kseniya Lvovsky, World Bank Country Manager for daily Gazeta Shqiptare

1. What is the current Bank involvement regarding the issues of property, legalization and compensation in Albania?

Currently, the World Bank is supporting a project on land administration and management which is helping to improve the speed and quality of services provided by the Immovable Property Registration Office (IPRO) and to complete the first registration and titling processes in selected urban locations.. Our program does not include any other projects on property rights, legalization or compensation issues.

2. The recent report of the WB on property issues has been quoted for some time now. Can you tell some of the main issues it covers?

The report “Governance in the Protection of Immovable Property Rights in Albania: A Continuing Challenge” focuses on the key issues affecting the security of immovable property rights such as:

  • The process of systematic title registration, which remains incomplete. Without reliable title registration property owners lack adequate legal protection in transferring (selling or bequeathing) their property and in applying for credit financing to improve their properties. Prospective investors are also often deterred from financing projects due to the difficulty in finding properties with clear legal title.
  • The process of legalization of informal constructions, which also remains incomplete. The legalization of these properties would enable their owners to maximize the value and utility of their properties and also would also generate revenues for the Government. These revenues could increase the resources available for the payment of compensation to the former owners.
  • The substantial number of unresolved claims under the process of restitution and compensation of former owners whose immovable property was expropriated under communism. A feasible solution would ensure that the cost of financial compensation can be paid within a reasonable timeframe, without jeopardizing growth, macro-economic stability and priority social expenditure.
  • The incomplete regulatory framework for territorial planning and the inefficient process for issuing construction permits. The recent adoption of the new Territorial Planning Law and the (pending) adoption of urban plans will help address many of the uncertainties affecting the issuance of construction permits.

3. Just few days ago, the Association Property with Justice accused the World Bank that it has prepared the report based on the data offered by government and politics, avoiding the owners. What is your opinion about that?

The Bank team have had several meetings with former owners, banks, notaries, real estate agents, members of the public etc., and made effort to recognize their views.  The second edition of the report is being prepared to integrate further feedback and views provided after the September 2011 workshop in Tirana when report was publicly launched.  At the same time, statistics and data that was utilized was generally taken from data offered by government as this is considered the official version.

 4. The association goes even further in their accusation by claiming that this report violates heavily their interests. Is it true?

I would like to emphasize that the report is an analytical paper, not a legal document, and, as such, can not violate any interests; it can only inform the public debate. The report makes the earnest effort to be unbiased and to serve public interest, without being unduly influenced by any particular interest group. It relates to the facts where these are known,  the opinions of internationally recognized experts and international experience in dealing with similar issues, particular in former communist countries of Europe. International experience with the restitution and compensation is very clear that a successful and sustainable solution has to balance the interests of different groups of affected stakeholders, the responsibility of state towards all its citizens and particularly the poorest with its obligations to any specific group; and the interests of current and future generations. It is the World Bankħ role to analyze and share relevant global experiences with its member countries.