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Is the lek overvaluing the Albanian economy?

2026-06-29 10:58:00, Ekonomi CNA

Is the lek overvaluing the Albanian economy?

This is the question that is often avoided. A strong lek sounds good on paper, but it can create the illusion of stability. If this strengthening is not accompanied by increased production, higher competitiveness, and a healthy export base, then we have more of a flow-on effect than a fundamental success.

The Albanian economy remains dependent on imports, services, construction and remittances. This is not necessarily a catastrophe, but it is reality. And when reality is hidden behind an exchange rate that is read politically as a triumph, a gap is created between propaganda and the citizen's pocket.

For example, if the euro falls, but the prices of food, rent and services do not reflect the same logic, then the citizen does not see any miracle in his daily life. This is why the exchange rate should not be seen in isolation from the cost of living. A stronger domestic currency only makes sense if it translates into real relief for the consumer and a more balanced economy.

 

Businesses, immigrants and families are feeling it differently

 

For exporting businesses, the weakening euro is a wake-up call. They are losing competitiveness, especially when faced with rising wages, expensive energy, taxes and logistics costs. Many of them do not have the luxury of raising prices in foreign markets, because competition is fierce. This means less profit, less investment and in some cases pressure on jobs.

For migrants, the blow is both emotional and financial. They send the same amount in euros, but their family in Albania benefits less. On paper, it seems like a technical difference. In practice, it means less money for medicine, for school, for rent or for food.

For families with savings in euros, the effect is mixed. If their expenses are in lek, the euro's decline makes savings less valuable in translation. On the other hand, those who pay their debts in euros may feel more relieved. So here too, the answer is not black and white./ CNA





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