Albania's Need for Radical Reform

`EVEN the chickens were nationalized," is one Albanian official's description of his government's former policy. More than any East bloc country, the Albanian communists took their ideology to its extreme by eradicating all private property.

No private property typified the radical Albanian brand of communism. Economically, it was a disaster. Most factories and farming collectives have closed. Unemployment is 80 percent. Despite Albania's emphasis on agriculture, most food comes via Western aid.

Albania's infrastructure is devastated. There is no functioning rail system. Telecommunications are frail. The country's attorney general says what's needed is "not a matter of restructuring, but of building a completely new economy."

Yet Albania should not be flooded with financial aid. Rather, material assistance should be specifically targeted at building Albania's infrastructure and at promoting particular sectors of the economy that promise sustainable development - tourism and appropriate use of Albania's many natural resources.

Worse than economic wreckage is the devastation of Albania's intellectual life. A prerequisite for a functioning democracy is an understanding of private property, free market forces, and rule of law. All were erased by the communists.

The eradication of private property means people don't appreciate the security private property offers for investment. Rather than develop property for long-term projects, people will focus on consumption and short-term gain.

Enver Hoxha's dictatorship crushed the market. Prices were based on party dictates, and everyone - minister to street cleaner - received about the same pay. Albanians don't understanding supply and demand. One man with beach front property was trying to sell his land for $10,000 per square meter since that's what he heard it sold for in Florida.

Law was also a tool of the party and subject to change. Cases were decided through the party. Enver Hoxha's writings were recognized as law and therefore binding. Law was political, offering little security or stability.

Hence, it is not surprising that even today, Albanians show little respect for rule of law. Agreements are made and broken at will. A taxi driver agreed to go from the airport to Tirana for $15, but demanded $20 upon arrival. Albanian friends witnessing this transaction then said the agreement was not binding.

Bribery is rife. A customs official at the port of Durres says his bribe income far exceeds his salary of $8 per month. He admits that many cars imported into Albania are stolen, but are "legalized" through bribes. Once paid for, the car can be sold normally - often to hard currency buyers in Greece.

HE tyranny of the party also stifled any dissent by prohibiting internal opposition and outside influence. The party imposed a permanent state of siege on the country, building some 600,000 bunkers to fend off outside attack. The enormity of the oppression and isolation has left its mark on Albanians. They remain passive, and rarely combine a critical thinking with a sense of imagination - both needed qualities in a viable democracy and economy.

Yet despite the brutal former regime, examples of private initiative are beginning to appear. One of the most promising is the Association for the Preservation of the Natural Environment in Albania, which tries to ensure that investment in Albania, especially hotels on the beautiful coastline, doesn't harm the environment. But even this group seems too cautious. Instead of lobbying relevant government ministries, their aim is only to collect and disseminate relevant information. Being an active proponent

of public opinion is still a foreign concept.

Albania must focus on three areas: First, attracting Western aid and foreign investment in infrastructure and key industries. Second, it should continue to draft laws to promote an orderly transition to a market economy, avoiding the "wild west" approach to economic development. Third, Albania must develop its intellectual infrastructure so that monetary and material aid isn't wasted. This means exchanges of students, teachers, lawyers - and teaching democratic concepts in high school.

The West should promote these policies through targeted literature and technical assistance. But in the end, the reform of Albania must come from within.