The directional pattern of the country's foreign trade has conformed to the general observation that trade follows aid. The assumption by Communist China in 1961 of the major aid donor position previously held by the Soviet Union had an immediate and pronounced impact on the direction of trade. In 1960 Communist China accounted for only 7 percent of the total trade volume, as against 54 percent for the Soviet Union. By 1962 trade with Communist China had grown to 51 percent of a somewhat smaller total volume, whereas trade with the Soviets had ceased altogether by 1963. In 1964 Communist China's share of the trade was equal to that of the Soviet Union in 1960, and the actual volume represented by that share was 23 percent larger. During the 1962-68 period trade with Communist China amounted to about half the total trade volume, but the share of Communist China declined below that level toward the end of this period. This decline was the result of a successful effort by the leadership to expand the country's trade with both Communist Eastern Europe and the non-Communist West.
Trade with the Communist countries of Eastern Europe, other than Yugoslavia, continued after the break with the Soviet Union and increased by 66 percent from 226 million leks in 1960 to about 375 million leks in 1968. The share of this group in total trade rose during this period from 35 to 40 percent, almost entirely after 1964. Albania's most important trade partner in this group has been Czechoslovakia, second only to Communist China with a volume of 118 million leks in 1968, equivalent to about 12 percent of Albania's total trade volume in that year. Following Czechoslovakia in order of importance were Poland, East Germany, and Bulgaria, with trade volumes ranging from 69 million to 53 million leks. Trade with Hungary and Romania amounted to about 40 million leks and 32 million leks, respectively. With the exception of Poland and Romania, Albania's trade balance with the countries of Eastern Europe was positive between 1960 and 1968. The excess of exports over imports during this period totaled about 65 million leks.
During the early years of the country's dependence upon Soviet aid, trade with non-Communist countries and with Yugoslavia had been discontinued, but it was resumed on a very small scale by 1955. In 1964 this trade amounted to only 65 million leks (equivalent to US$13 million at the official rate of exchange), or 8 percent of the total trade turnover. Fully two-thirds of this trade was accounted for by Italy and France. During the following four years trade with the West and Yugoslavia increased 2-1/2 times to 160 million leks in 1968, and the share of this trade in the total turnover doubled.
Italy continued to be the major Western trade partner, with a turnover of 66 million leks in 1968, but the largest advance was made in the trade with Yugoslavia. The total trade turnover with that country rose fiftyfold in one year, from 400,000 leks in 1965 to more than 20 million leks in 1966. Under the 1970 trade agreement the trade volume is scheduled to reach 50 million leks. In 1968 Italy and Yugoslavia together absorbed four-fifths of the combined exports to the West and Yugoslavia and supplied more than half the imports from that area.
Another striking example of the country's trade expansion effort is the agreement with Greece, a country with which Albania has had no political or economic relations for thirty years. Signed by the chambers of commerce of both countries in January 1970 and effective for one year, this agreement provided for an initial turnover of 7.5 million leks, of which 4 million leks were in imports and 3.5 million leks in exports. Commercial orders worth about 1.5 million leks on both sides were reported to have been placed by mid-1970.
In 1969 trade relations were officially reported to have been maintained with forty different countries. Relations with thirteen of these countries, both Communist and non-Communist, were formalized by trade agreements.
Imports have overwhelmingly served the needs of production and industrial expansion. Almost 50 percent of the imports in 1964 consisted of machinery, equipment, and spare parts. More than 23 percent was accounted for by minerals and metals, chemical and rubber products, and construction materials. Another 16 percent was made up of agricultural raw materials, about two-thirds of which was destined for the food-processing industry. Only 11 percent of the imports consisted of finished consumer goods and ready-to-eat foods. Continuing Party and government emphasis on increasing production and the improved domestic output of foods suggests that the production-oriented nature of imports did not change significantly by 1970.
Exports have consisted predominantly of minerals and mineral products but have also included significant amounts of agricultural products and manufactured consumer goods. In 1969 petroleum and natural bitumen, chromium and ferronickel ores, and copper (including copper wire), constituted 55 percent of exports. Another 25 percent comprised processed foods, such as canned fish and vegetables and preserved fruits; light industry products, including cotton and linen textiles and some readymade clothes; and a few chemicals. The balance of 20 percent was represented by fresh fruits and vegetables and by agricultural raw materials, such as hides and skins, tannins, and medicinal plants. Exports of fruits and vegetables to central and northern Europe have been growing rapidly.
The share of manufactured and semiprocessed products in exports was also officially reported to be increasing and to have constituted 51 percent of the export volume in 1968. Students of Albanian affairs have reported that some of the country's exports are not competitive in world markets and that Communist China has been willing to absorb them at a good price only for political reasons, as did the Soviet Union before 1961.