Is Albania Empowering a Next Generation of Social Entrepreneurs?

TIRANA, November 5

So far, only six non-profits got the social enterprise (SE) status in Albania, a recent study conducted by the Regional Incubator for social Entrepreneurs (RISE) confirms. However, the study found that interest in social enterprise seems to be increasing, as seen by interested parties. The Regional Study and Guidelines on Social Entrepreneurship in the Western Balkans provides the most recent, relevant, and concise information on the current state of the affair in social entrepreneurship, youth entrepreneurship, and, through some of its elements, even on the broader social economy ecosystems in the WB6 region.
The study found that some of the key obstacles and limitations for youth starting a business include:

• The unstable political and economic situation in Albania,
• Obstacles and limitations created by the Law on SE,
• Complex administrative procedures,
• Lack of education on entrepreneurship,
• Inadequate access to professional support and mentorship,
• Lack of business contacts among youth,
• Lack of start-up capital,
• Lack of support in their immediate surroundings,
• Inadequate access to professional support and mentorship,
• Limited duration of programs run by the governmental and non-governmental organizations,
• Underdeveloped entrepreneurial culture and mindset, etc.

According to the study, the Albanian Law on Social Enterprises granted the status of social enterprises only to six non-profits. However, stakeholders believe that there are other SE registered as conventional businesses. Measurable data on the exact number of SE in Albania are not available. Even though the Law on SE foresees the creation of the register for SE, it is not functional yet.
On the other hand, the data from the National Business Center confirm the presence of 160,624 small and medium-sized enterprises in Albania during 2019. This number was equivalent to 98.8 percent of the total number of enterprises.
Further on, the survey points out that social services such as therapies, psychological counseling, daycare centers for children and people with disabilities, vocational training and carrier counseling for youth, and soft skills training for children and youth are implemented by non-profits conducting economic activity.
Moreover, social entrepreneurship is perceived as an activity of a for-profit organization (private company) with a social mission while social enterprises are defined as non-profit organizations embedding the social aim and providing social services, as well as employing persons from marginalized groups.

“According to public institutions, the approved Law regulates social enterprises, meaning that only non-profits can be registered under this Law,” the study points out.
Regarding the law on SE, it was initiated, drafted, and approved over six years starting in 2010.
However, the study highlights that the Law was approved by the Parliament without the de facto consent of the SE sector.

On their part, young entrepreneurs stated the need for being a part of a well-established and free market. Among the main needs for success, education (both formal and non-formal), professionally tailored training, capacity building, and mentoring support are listed.
According to the UN, social entrepreneurship offers not only a path for young people to transform their own lives but also a way to empower others, but social entrepreneurs need a favorable and enabling business ecosystem to thrive and to bring their impact to scale.
Hence, it seems that the Albanian Law on SE needs an upgrade regarding the categories of businesses and organizations that can be registered as social enterprises, and much more.

Source: RISE