Foreign investment in real estate reached 610 million euros in January-June, up 141% from the same period in 2025. It accounted for more than half of total foreign direct investment during the period.

In the second quarter alone, real estate investment reached 438 million euros, the highest quarterly figure on record, up 194% year-on-year.

The surge in property investment has been linked to major development projects, particularly in tourist areas, as well as increased purchases by non-resident buyers.

Bank of Albania survey data showed that around one in five homes sold in the first half of the year were bought by non-residents. About 85% of those buyers were citizens of European Union countries.

Foreign capital also flowed into the financial sector, which attracted 181 million euros, up 23% year-on-year. Manufacturing drew 92 million euros, trade 67 million euros and energy 66 million euros, while information and communications attracted 48 million euros.

Overall, foreign direct investment rose 50% from the first half of 2025 to its highest level on record for the period, the central bank said.

/e.xh/j.p/u.sh/

According to Bank of Albania data, the improvement was recorded across several segments of the loan portfolio, particularly short-term loans, lek-denominated lending and business loans.

At the end of June, non-performing loans totalled about 37 billion leks. The share of loans classified as “loss” fell to 44% from 47% at the end of 2025, while “substandard” loans accounted for 41% of the non-performing portfolio, up from 34% at the end of last year.

During the first six months of 2026, banks wrote off about 5 billion leks in loans. The Bank of Albania said the amount was 6% lower than in the same period of 2025, with the loans written off mainly denominated in lek and concentrated in the business segment.

The central bank said writing off bad loans from banks’ balance sheets is an accounting measure that reduces the non-performing loan ratio but does not create an additional financial effect.

/e.xh/j.p/u.sh/

The figures were discussed at a meeting between central bank Governor Gent Sejko and chief executives of commercial banks, also attended by Economy and Innovation Minister Delina Ibrahimaj.

The talks focused on developments in the banking sector, credit growth, the property market and issues related to financial stability and the development of the financial system.

Sejko said the pace of lending was supporting consumption and investment, while stressing that credit growth should remain prudent and sustainable, backed by appropriate lending and risk-management standards.

Mortgage lending rose 16.1% year-on-year in the first half, while the average interest rate on lek-denominated mortgages stood at 3.9%.

The meeting also reviewed the Bank of Albania’s macroprudential measures governing housing finance, including limits on loan-to-value and debt-service-to-income ratios. Sejko said the measures had contributed to more prudent and balanced lending in the housing market.

/e.xh/j.p/r.e/u.sh/

The figure was the highest ever recorded for the first six months of a year, highlighting tourism’s growing contribution to the Albanian economy.

Revenue growth outpaced the increase in foreign arrivals, indicating higher average spending per visitor. Bank of Albania and INSTAT data show that foreign visitors spent an average of about 470 euros in Albania during the first half, up from around 440 euros a year earlier.

Nearly 5.1 million foreign citizens entered Albania during the period, an increase of 6.2% year-on-year.

Meanwhile, Albanians spent about 1.4 billion euros on travel abroad, up 9.5% annually.

The resulting positive travel balance stood at 957 million euros in the first half, the highest level recorded for the period and close to the 1 billion-euro mark.

The travel surplus is an important component of Albania’s services sector and contributes to foreign-currency inflows. The country has recorded a positive travel balance since 2015, with the gap widening over the years.

The latest figures suggest that tourism’s economic impact is increasingly reflected not only in visitor numbers but also in the amount they spend during their stay.

The double-digit increase in foreign visitor spending, alongside a 6.2% rise in arrivals, points to stronger tourism revenue generation for the Albanian economy.

/e.xh/r.e/u.sh/

Household lending rose 17.1% year-on-year at the end of June, driven by a 20.2% increase in lek-denominated loans. Lending in foreign currencies grew 5.5%.

Central bank data show that Tirana remains the main destination for household lending, particularly mortgage finance. The capital accounted for about 56.8% of consumer loans and roughly 75% of mortgage lending, underscoring the high concentration of housing finance in Tirana.

Business lending grew 11.6% year-on-year in the first half of 2026, with trade making the largest contribution, at 6.1 percentage points. Loans to the trade sector accounted for 46.2% of the total business loan portfolio.

Industry ranked second, followed by construction, which represented 21.7% of the portfolio, and services at 16.1%. Agriculture accounted for the smallest share, at 1.3%.

Interest rates remained broadly stable, while lending in lek continued to gain ground.

The Bank of Albania said the rise in lending to households and businesses pointed to an expansion of bank financing to the economy, although the data also highlighted the strong concentration of housing finance in the capital.

/e.xh/j.p/u.sh/

Total revenues rose by 44.5 billion leks, or 12.2%, compared with the same period a year earlier, accounting for 49.9% of the annual revenue target.

Public spending in the first six months reached 357.8 billion leks, or 97.4% of the planned amount, up 7.5% from the same period in 2025.

Tax and customs revenues totalled 260.1 billion leks, exceeding the six-month target by 4.4 billion leks, or 1.7%, and increasing by 17.8 billion leks, or 7.3%, year on year.

Tax administration revenues amounted to 141.5 billion leks, up 10% compared with the first half of 2025 and 4.6% above the planned level.

Net value-added tax (VAT) collections reached 41.6 billion leks, rising 25.4% year on year and exceeding the six-month target by 17.9%. VAT refunds during the period amounted to 7.9 billion leks.

Personal income tax revenues rose to 47.6 billion leks, up 16.6% from a year earlier and 15.4% above the government’s plan, while corporate income tax collections stood at 31.1 billion leks, meeting 85.2% of the six-month target.

Revenues from social and health insurance funds reached 99.2 billion lek, up 13.3% year on year and exceeding the period’s target by 2.8%.

Customs administration revenues totalled 118.6 billion leks, an annual increase of 4.3%, with import VAT collections reaching 79.1 billion leks, up 4.2% from the same period in 2025.

Excise duty revenues amounted to 33.6 billion leks, rising 4.6% year on year.

On the spending side, capital expenditure reached 36.8 billion leks in the first half, exceeding the planned level by 3.8% and increasing 10.2% compared with the same period a year earlier.

Current expenditure stood at 321.1 billion leks, or 97.4% of the planned amount, up 7.2% year on year, the Ministry of Finance said.

/m.q/j.p/u.sh/

Statistics released by the Media and Information Agency on Wednesday showed that social security contributions collected during the January-June period totalled 93.9 billion leks, up 10.9% from the same period a year earlier.

The increase was driven by higher wages, continued formalisation of the economy, the introduction of reference wages in key sectors, increases in the minimum wage and expanding economic activity, the Agency said.

According to the Agency, a more formal labour market and higher contribution revenues strengthen the sustainability of Albania’s social security system and provide greater security for citizens.

/m.m/ /a.g/u.sh/