Albania faces a significant economic threat from earthquakes — the most damaging natural disaster risk to the country, according to the World Bank. In its most recent report published in November, the World Bank warns that by 2050, earthquakes alone could reduce Albania’s GDP per capita by more than 15.6% if no major resilience measures are taken.
The projections are part of a broader analysis of the negative economic impact of climate change and natural disasters on Albania. Earthquakes, in particular, are expected to slash GDP per capita by 6% by 2030, 11.5% by 2040, and up to 15.69% by 2050, with broader implications for public finances and national stability.
The report highlights that such seismic shocks could also widen the current account deficit by as much as 3 percentage points of GDP by 2050, placing further stress on Albania’s economic framework.
High Exposure and Financial Risk
Among European nations, Albania ranks among the highest for exposure to natural disasters — including not only earthquakes, but also floods, landslides, and wildfires. Over the past two decades, 95% of Albania’s municipalities have been affected by at least one of these events.
The most devastating example in recent memory came in 2019, when Albania was struck by two powerful earthquakes in September (magnitude 5.6) and November (magnitude 6.4). The November quake caused widespread devastation, particularly in Tirana and Durrës — the economic and tourism hubs of the country. The total damages were estimated at $1.1 billion, equivalent to 6.4% of Albania’s 2018 GDP, with additional economic losses accounting for another 1.1%.
Between 1995 and 2015, Albania recorded 162 earthquake events, causing approximately $27 million in damages. Though that figure seems modest compared to the 2019 disaster, it underscores the growing intensity and impact of recent events.
Limited Financial Tools for Disaster Response
While Albania has taken recent steps to strengthen its disaster risk management and expand insurance schemes, the World Bank notes that the country still lacks predefined risk financing instruments. In practice, this means that after a major disaster, Albania must rely on budget reallocations, post-disaster borrowing, and international donor support to recover.
Natural disasters in Albania currently generate average annual losses exceeding $130 million. Without improved resilience and better risk financing mechanisms, the country risks being caught in a cycle of destruction and slow recovery — a cycle that could severely hinder long-term development and poverty reduction efforts.
A Call for Urgent Action
The World Bank's report serves as a stark warning: earthquake preparedness must become a national priority. Investing in resilient infrastructure, urban planning, early warning systems, and dedicated emergency funds is critical to safeguarding not just lives, but also the economic future of Albania.
If proactive measures are not implemented, the country’s economic growth engine — particularly in urban centers — may be severely disrupted, with social services like healthcare and education forced to bear the fiscal burden of repeated disaster response.
As the frequency and severity of climate-related disasters increase, Albania's path to sustainable growth may depend on how effectively it can strengthen its defenses today to weather the shocks of tomorrow.