Economic Growth Fails to Reduce Poverty Level
The World Bank estimates that in 2023, per capita income in Albania amounted to Dollar 8,575. The average daily income for a person in Albania was Dollar 23.5 per day, a value close to the prosperity standard of Dollar 25 per day defined by the World Bank as a global average value of a dignified life.
With the decrease in population according to the 2023 Census data and with economic growth of around 4% in 2024, the average daily income of Albanians exceeds the standard of prosperity, but on the other hand, according to data from the World Bank, Albania also has the highest level of poverty in the region.
According to the latest World Bank reviews, the number of people with incomes of Dollar 6.7 per day (relative poverty) will be more than 20% of the country's population by 2024.
Achieving standards of prosperity on the one hand and a fifth of the population in poverty on the other hand demonstrate the country's high economic inequality.
As the economy grows, it is not distributed fairly. The rich get richer and the poor get poorer.
The World Bank defined the prosperity standard (Dollar 25 per day) in order to increase sensitivity to issues of the distribution of economic growth.
States will need to identify the percentage of the population living below this gap in order to then apply fair redistribution policies.
The Bank tracks shared prosperity by monitoring the growth of average incomes in the bottom 40 percent of the population. The prosperity standard set at Dollar 2.5 a day (adjusted for differences in purchasing power parity between countries) is defined as the average factor by which incomes need to be multiplied to bring the world to the standard of prosperity. For example, for a person whose income is Dollar 2.50 a day, it needs to be multiplied 10 times to reach the standard of prosperity.
The World Bank emphasizes that Albania has an untapped human capital potential that can drive growth and development.