The relationship between the output of capital goods and that of consumer goods is equally ambiguous. The share of capital goods in the output of 1968 was officially reported as 55.5 percent, as against 44.5 percent for consumer goods. The apparent discrepancy between the reported shares in total output of consumer goods as compared with the production of the light and food industries may be explained, in part, by the fact that a portion of these industries' output is usually included among capital goods as, for instance, textiles used by the clothing industry and leather used by the shoe industry.
Foreign observers have reported the country's industry to be poorly balanced not only in a technical sense but also in terms of essential domestic needs and the availability of foreign outlets for its products. The metalworking industry, for example, which is limited to the production of automotive and industrial spare parts, apart from a few types of simple agricultural equipment and household utensils, cannot even ensure the maintenance of the existing machinery inventory because it is able to supply only about 60 to 70 percent of the country's needs. Industrial production is substantially oriented toward capital goods and exports, whereas the manufacture of products for domestic consumption continues to be severely restricted.
The leadership is aware of industry's structural shortcomings and is intent on overcoming them through a program involving the reconstruction and modernization of old plants and the concentration of small shops into larger, more efficient specialized units. Progress in this direction, however, has been hampered by inadequate investment resources and by a reluctance of managers and workers to cooperate with this program. It has also been handicapped by a lack of effective planning and by an inability to organize comprehensive studies that would provide a basis for both overall and detailed plans.
Nevertheless, a few plants for the manufacture of machine spare parts and of simple equipment were formed through the concentration of milling machines previously installed in maintenance shops of various enterprises, and a step toward the consolidation of small artisan shops was taken in May 1969 by transforming artisans' cooperatives into state enterprises.
Owing to the lack of prior industrial experience by both managers and labor, industry also suffers from poor organization of production and of the material supply, low labor productivity, and generally inferior quality of product. Extensive discussion of these problems in the official press indicates that government efforts toward reducing the magnitude of these problems are slow in bearing fruit, despite programs for vocational training and intensive campaigns of political indoctrination aimed at generating productive enthusiasm and innovative initiative among workers and managers. A major campaign is being waged to eradicate artisan traditions and to replace them with industrial production line methods. The basic difficulty in achieving greater efficiency lies in the continuing severe shortage of skilled manpower and of personnel with adequate training in the economics and mechanics of industrial production.
Because of the underlying pricing methods, officially reported data on total industrial production in value terms overstate the actual rate of growth attained. Substantial industrial progress is, nevertheless, indicated by physical production data for a number of commodities (see table 12). Since production had started from nothing or from very low levels in the early post-World War II years, the rates of growth in output were substantially higher during the 1950s than in the following decade.
The highest rates of increase during the 1960s, ranging from five to three times the initial volume, were achieved in the production of copper, electric power, and cement. Increases of from 69 to 80 percent were attained for coal, oil, and iron-nickel ore. Production of textiles and footwear grew by more than half, and that of knitwear more than doubled. A substantial advance was also made by the food-processing industry. Least progress was made in the production of cigarettes and bricks—only about 6 to 7 percent—and the output of timber actually declined from 6 million to 5 million cubic feet. Most of the mining output and a substantial share of the food industry production are exported.
Rapid electrification of the country has been a major goal of the leadership. Electrification is intended to meet the needs of industrial development and help attain a higher standard of living in rural areas. A crash program has been underway to bring electric power to every village, even in the remotest areas. This project was originally scheduled to be completed in 1985, but the date has been advanced to November 8, 1971, the thirtieth anniversary of the founding of the ruling Albanian Workers' Party. The program is being carried out by the prevailing method of mass mobilization for voluntary work.
Installed capacity in 1969 was reported to be 210,000 kilowatts, of which 128,000 kilowatts were in thermal powerplants and 82,000 kilowatts in hydroelectric power stations. This capacity reflected a fourfold increase since 1960, a large part of which was accounted for by a single thermal plant of 100,000-kilowatt capacity put into operation in late 1969. The country's hydroelectric power potential has been estimated by Albanian technicians as roughly 3 billion kilowatt-hours per year, half of which is represented by the Drin River. Development of this potential has barely begun. The first major plant on the Drin with a capacity of 225,000 kilowatts is scheduled for completion at Vau i Dejes in 1971, and a second station on that river with a capacity of 400,000 kilowatts is to be built at Fierze during the Fifth Five-Year Plan (1971-75).
Table 12. Industrial Production in Albania, 1960 and 1964-69