Government and private sector in transition economies

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Actually Albania is intensively included in the regional and European integration processes. Through performing the commitments as a member of WTO, through signing the FTA-s, Stabilization and Association Agreement (SAA), CEFTA, the free trade is doing quick steps toward liberalization. Nevertheless, the indices of foreign trade are still not very encouraging. The European Unions countries are the main trade partners of Albania and the trade liberalization processes with these countries may be accompanied with high pressure by them. This paper tries to analyze the competitiveness of Albania economy in European markets and how the trade openness does affect the competing capabilities of our country in European markets. The paper tries to analyses the problems of competitiveness in some aspects. Firstly, presenting an empirical analysis of quantitative indicators, that shows the level of Albanian integration in European markets. There are three trade indicators that are analyzed and estimated, for different trade categories, such as: • Openness indicator; • The indicator of revealed comparative advantage (RCA, based on Balassa indices); • The indicator of intra-industry trade (index of Grubell–Lloyd).