Conversation with start-up companies, new enterprises benefiting under business and innovation support schemes

The Prime Minister Edi Rama at conversation with representatives of start-up companies and enterprises benefiting under the government’s support scheme for businesses and innovation: 

 

Prime Minister Edi Rama: The most recent developments, over the last few years in particular, have clearly shown that the role of the innovative and start-up companies and the new enterprises launched by young people is becoming increasingly important as a critical component that drives economic growth in our economy.

We have consistently tried to build a suitable ecosystem to foster start-ups in Albania and we have taken several steps, which are definitely important, yet not sufficient enough in the efforts to assist your and others’ initiatives, mainly focusing on innovation and information technology. For some time now, we have approved a 5% profit tax rate on the operators in areas of the information technology.

On the other hand, we strongly believe that with the decision to scrap the profit tax on the small businesses we have provided a significant relief to entire small business community, but specifically, since we are here with you and we are talking about this sector, we have created an even better climate in terms of promoting this kind of ventures.

Likewise, the adoption of the new legislation on payment services paves the way to fresh developments in this market of technology, allowing for instant payments and providing conditions for other banking and non-banking operators to make use of the payment system. We believe this would expand the market to involve new stakeholders and will have important impact on the efforts to formalize the country’s economy.

The electronic signature that meets requirements for safe digital signing represents another step with a positive impact on the online service delivery, a sector we think it has undergone a colossal transformation compared to where we started from, and not to where we are seeking to arrive, providing individuals the opportunity to benefit cost-free, corruption-free and real-time services.

Of course, a lot can be said, but I won’t take more of your time, and I just made a brief introduction. I would be pleased to give you the floor.

Thank you again for your presence and the floor is now yours.

–I am a winner of the IDEA project supported by the Ministry of Finance. Which could be some of the mechanisms that would further strengthen innovation initiatives regarding the Albanian environment and a broader area?

PM Edi Rama: Thank you. I would like to add something regarding this issue in order to offer a glimpse into the current panorama for you and those watching us now, always asking for this general panorama to be assessed by considering our starting point several years ago, when, for the sake of truth, initiatives of this kind were mostly individual and without a ray of hope in terms of the government’s attention and support.

We have earmarked a special fund to support enterprises of kind, helping them to expand from manufacturing to the service sectors, light industry, tourism, and various research areas, agro-processing, modelling, designing and handcrafting. And I am pleased to say that thanks to this support scheme, out of 61 small and medium-sized enterprises, which have benefited and account for 66% of the applicants – the total number of the applicants was 92 – 30 of the winning ventures have benefited support precisely in the field of innovation and technology auditing and 28 of them have relied on technological equipment and the rest have relied on software development.

On the other hand, as someone noted, the EU has been also involved in this scheme and a total of 150 start-ups have benefited direct support in addition to the abovementioned. All these data indicate that here there is a lot of potential to develop and we can say that we are at a stage of launching an embryo, but not of its consolidated development. Precisely for this reason, we strongly believe that interaction with you is fundamental.

You shouldn’t feel like being passive stakeholders, but as very active ones in this process. You should not just wait and refer to our answers, but you should embark on finding ways to provide new answers together. I strongly believe that you have really helped us through your work and your evidence of your work for us to look further and better understand that there is an extraordinary perspective out there.

In our vision for the 2030 Albania, this aspect of our social and economic life, directly linked your work, has a much bigger weight than the weight it used to hold in the past, because it is an aspect interconnected with other aspects, and best complements and strengthens other aspects in every area.

We are very encouraged by the fact that we have launched a new path with the TUMO centre in Tirana. We are working to prepare a fantastic space in line with the highest European and contemporary standards at the Pyramid building, which will house not only TUMO centre, but also many other initiatives and transform the Pyramid into a huge evolution hub in this aspect.

A flexible programme has been opened in Korça to support Start-up initiatives, just like it is the case with such projects in Shkoder. Korça has benefited a fund to develop this ecosystem regionally. New library in Korça, with its building already complete, is being readied to become available to the start-ups, as well as a process of intensive contemporary courses that range from programming to coding.

In the meantime, we are also preparing the project designed to transform that ghost building in Vlora into a community centre, with its core dedicated precisely to the start-ups and digital coding. We are seeking to build an entire network of such centres all over Albania in order to provide young people the opportunity to gain access and involve in this network, introduce and develop their initiatives, as well as attend intensive training courses to become computer programmers and develop a range of know-how capacities so that they can access a much bigger international market without having to leave Albania.

What I have said about the reality in Korca, and not only, has met a lot of ridicule. Many of you are protagonists of this reality and not simply eyewitnesses, as you have experienced and you are living this reality that has been created thanks to your construction, with the young people creating quality job opportunities for themselves, not work done simply because something has to be done to provide for the family. A job that can open up an extraordinary prospect of getting paid just like many people do not even expect can be achieved.

– Before making my questions, since you are talking about the EU-funded project, I would like to affirm that I am one of the beneficiaries of these projects. If we consider consolidating the development of technology and IT, the main thing or the fuel of these initiatives is digital money and as long as digital payment is not a reality in Albanian consumption, I think that the development of these initiatives will always suffer.

PM Edi Rama: I fully agree and support your opinion, but I just want to remind you of the fact that Albania, not because we are better than others, but because of the position we are located in, we are provided the opportunity to make great leaps in this domain, which provides those lagging behind the opportunity to take important steps forward, steps that would have been totally impossible in another era. If development prior to birth of this digital revolution world-wide was dictated by a slow progress and non-quick technology and know-how transfer with the replacement of mechanical typewriters with more advanced typewriters, whereas the today’s technology tools you can make epochal leaps without being forced to go through all stages, though you might have been lagging a lot behind others that have already made these gradual transitions.

I made this parenthesis to note that by seizing this chance and the today’s opportunity, Albania is the first country to adopt a complete legislation in Parliament aimed at regulating whole process or the digital currency activity. Certainly, this is not directly related to what you said about digital payments, but I said this to confirm that we are very careful in this regard and we have really gone far with this legislation, which is seen with great interest by partners and other states. We have also launched a process regarding the digital payment and this process will be very fast, because of time, not because of us. This is a goal to move very quickly to that stage, taking advantage of the opportunity created thanks to the technology.

– I launched this enterprise few years ago and our company was eligible to benefiting under the training and financial support programme IDEA. I would like to ask you whether the government plans a technical support for the stakeholders operation in the innovation sector and how do you think that new enterprises can further consolidated so that they can gain access to the EU funds, which currently remains a challenge to every Albanian enterprise?

PM Edi Rama: I would like to first highlight a very important aspect of your question, concerning both the incredible potential opportunity that can be granted both through the access to the EU funds to support this sector and the necessity to become ready to benefit from this access. I would provide a simple example. Few years ago, Albania was the last country in the region in absorbing the EU funds supporting agriculture and rural development. Today, Albania is a leader in absorbing the EU funds in the region. Why are we the first?

It is not that we have worked wonders. We have just learned, we have figured out the ways and how to reorganize the Agricultural and Rural and Development Agency as a centre to coordinate all the efforts and channel them into the right direction of information in order to assist entrepreneurs in agriculture and help them become top beneficiaries. We need to move in the same direction also in this respect.

Keep in mind the fact that you are the ones, who could become the pioneers and the trailblazers in paving this path, by setting an example for others to lead, because, however, by being enterprises that have relied on the strength of the ideas through the projects designed to benefit funds and you haven’t been idly waiting for the funds to fall from the sky. You have already cultivated such a culture. The European Union has approved a programme and a very ambitious investments plan worth 28 billion euros in the Western Balkans, 20 billion euros in loans and 8 million euros in grants respectively, to support three main pillars:

Infrastructure in terms of connectivity through highways, ports and other crucial infrastructure links, which are important for all countries in our region;

Energy;

And digitalization,

As far as the digitalization is concerned, this is about learning, figuring out and organizing in a way so that we benefit as much as possible in the best interest of our country and the country’s economy, where you are stakeholders. I believe this is very important in terms of your direct involvement in a cooperation that should be strengthened with the government and with the institutions. One of the participants made a reasonable remark regarding the agency in question. These seemingly tiny and less important things, which are organizational details, could make the big difference. They can make this whole machinery fail or properly work in serving the interests it has been established for or speed up work of this machinery.

– Would the legislation be reviewed in order to adapt it with the digital changes and the market needs so that the technology and innovation start-ups are provided equal opportunities in this competitive environment of the international market?

PM Edi Rama: Do you mean the national legislation? I am asking you because we are talking about the international market.

 – Let’s suppose more facilities and incentives regarding payments from the start-ups that operate according to certain plans, so that we can be provided the opportunity to access the international market.