Building a more competitive private sector in Albania

By Lucia Sconosciuto

Albania's Europa Construction and the EBRD are helping build a more competitive private sector.
With the EBRD’s help, Albania’s Europa Construction is refashioning the country’s landscape. 
 

Few entrepreneurs can claim to have contributed to building their own country. But two brothers from Albania, Thanas and Vangjel Rula, can. As founders and owners of Europa Construction, which produces metal infrastructure used in tunnels, dams, sports arenas, cinemas and industrial facilities, they are responsible for work that has become, quite literally, part of Albania’s landscape.
 
And, as successful businessmen in a transition country, they also set an example of how to build a stronger, more competitive private sector. The relatively under-developed small and medium-sized enterprises (SMEs) sector has the potential to modernise and create more value in the Albanian economy, which is still too reliant on imports.
 
When the brothers first established Europa Construction in 1995, they had experience building petrol stations and tanks. Private car ownership was booming and petrol stations were mushrooming all over the country.
 
“We thought: why don’t we do it ourselves?” recalled Thanas. “We bought the machinery and the facility and we started with the first private petrol station of an Italian company.”
 
The brothers established their company’s premises in 1,000m2 of space on the outskirts of Elbasan, one of the largest Albanian cities, in a huge disused district built in the 1970s for a metallurgic plant and celebrated as industrial jewel by the then Communist regime. The market economy was bringing new life to the area and Europa Construction was one of the first companies to have reclaimed this strategic space from industrial archaeology.
 
Soon demand for their products started to grow, especially from large foreign companies operating in Albania. Guaranteeing higher quality standards therefore became a priority for the company’s future. At this crucial time, EBRD Small Business Support (SBS), with funding from the Netherlands, matched Europa Construction with an expert consultant to guide the company through the ISO certification process.
 
“Only a few Albanian companies in this business have ISO standards so we gained a real advantage,”  explained Ermal Rula, Vangjel’s 32-year-old son, who is involved in the family business as a project engineer. “Now our suppliers too need to be certified so other companies are complying with better standards.”
 
Further SBS support funded by Luxembourg helped the company develop a new strategic plan for the future. Its implementation required investment for the expansion of the workshop area and acquiring new technology. The successful drafting of the business plan resulted in Europa Construction receiving a loan from a local bank for over half the investment needed.
 
Enhancing local skills and strengthening SMEs’ performance is at the heart of the EBRD’s work via SBS. The ultimate goal is to enhance the competitiveness of Albania’s SME sector. Now European Construction operates a 6,000m2 facility, the production system is more streamlined, security for the 48 employees has increased and costs and construction defects have diminished.
 
“It’s a great time for us,” said Ermal. “The ISO certification and the business plan opened up many opportunities. We recently landed a huge order from a leading French company doing engineering works for the Banja Hydropower plant, on the Devoll river.
 
“Our pipes will feed water from the lake to the turbine that generates power. It’s a huge achievement that makes us proud.”