End of a Nation? Why Albania Fell Apart

A difficult history led to the current crisis in this unique Balkan nation

What's at stake?

Europe's tinderbox

Albania, Europe's poorest country and one of its smallest, has descended into anarchy over the last two months. Popular outrage against the government was ignited by the collapse of several shaky pyramid schemes that bankrupted many Albanians. Like other turmoil in Europe this century, the crisis might draw in the United States.

Here's the worry: The disorder could lead to uprisings by ethnic Albanians in neighboring Serbia and Macedonia, where American troops are stationed. Many people in Albania are very poor and may decide to sell weapons they have looted from Army depots to these Albanians outside of Albania in order to earn money for food.

Many nationalities live in this southeast portion of Europe known as the Balkans. It has been referred to as the tinderbox of Europe ever since the 19th century, when the Islamic Ottoman Empire increasingly lost control of the region, and European nations began to compete for influence. World War I was sparked in the Balkans.

Europe's future

Solving the Albanian crisis is seen as a test of Europe's ideal of creating a peaceful continent of market democracies after the end of the Soviet empire. The European Union's inability to end the war in Bosnia, and America's role in finally forging a peace accord, has put a spotlight on Europe's response to the current crisis.

In all post-communist Eastern European nations, the challenge continues to build democracies and civil societies. For close to two generations, Albania experienced Europe's most repressive, isolationist Communist rule. Enver Hoxha ruled the country with an iron hand from the early 1940s until his death in 1985.

Albanians were ignorant of the outside world, denied the practice of religion, and became accustomed to near-total dependence on government. That legacy helps account for their belief in the get-rich-quick pyramid schemes, and the popular outrage that followed the collapse of the schemes.

Who are the Albanians?

Albanians are descendants of the Illyrians, an Indo-European people that settled in the Balkan peninsula from north of the Danube during the first millennium BC. When the area was invaded by migrating peoples such as the Slavs in the 5th and 6th centuries, only the Illyrians in the south of the region - roughly modern Albania - remained unconquered and unassimilated. Thus Albanians are not considered Slavs, unlike most others in the Balkans.

Modern Albania is roughly divided between two ethnic-linguistic groups, the Ghegs, who live north of the Shkumbin River, and the Tosks in the south. The Tosk dialect is in official use.

Despite minor differences in appearance, dress, and culture, both groups - representing 97 percent of the country - consider themselves Albanian.

But the north-south divide appears to be growing.

Former Communist dictator Hoxha was from the south, and it remains a stronghold for the Socialists, many of whom are former Communists. President Sali Berisha is from the north and has been accused of giving northerners positions within his government at the expense of southerners.

The south is primarily held by a loose coalition of rebel groups that demand Mr. Berisha's resignation. Many observers say that the mafia and the opposition Socialists comprise most of these rebels. Most Albanians in the north still appear to support Berisha.

Why did they invest in pyramid schemes?

Fraudulent get-rich-quick schemes still nab the unwary in almost any country. Albanians, unfamiliar with the basics of a market economy after the end of communism in 1991, found a promised return of 20 to 60 percent per month quite appealing. Many people sold homes to invest in the pyramid schemes, which were first introduced by ethnic Albanians from the Kosovo region of Serbia and Italians.

The Communists left Albania with outdated industries. Unemployment was high, and many believed that the only hope for survival was to leave the country (many fled to Italy and Greece) or to put the little money they had in the pyramid schemes.

The schemes lasted for a surprising three to five years. Some Albanians and outside observers allege it is because large sums gained from selling weapons to the Serbs during the war in Bosnia were invested in the schemes. As the schemes continued to yield a payback, even the skeptical started to invest. It is estimated that more than 75 percent of all Albanians invested - and lost money - in the schemes.

What happens now?

Now that much of the south is in rebel hands and most people have guns, a settlement is very difficult. Southern rebels have threatened to form an alternative government if Berisha does not resign by today. The speaker of parliament says he fears a coup.

Even if a strong national government is established in the capital and most weapons collected, the country may require a long time to come together and rebuild. In addition, the wave of fear and despair that has washed over the country - sweeping away much of the political and economic progress over the past five years - needs to be removed. Compromise and tolerance, important in a democracy, have not characterized any of Albania's governments since World War II.


1912: Albania declares itself independent of the Islamic Ottoman Empire; becomes a monarchy in 1928.

1939: Mussolini invades and annexes Albania to Italy.

1944: Communist leader Gen. Enver Hoxha assumes control of the country.

1948, 1961, 1978: Albania severs ties with fellow Communist countries - Yugoslavia, Soviet Union, and China, respectively - mainly due to ideological differences.

1990: Popular protests, due in part to widespread famine in the late 1980s, lead to a dismantling of the Communist regime. The Democratic Party of Albania (PDS), the first legal opposition party and now the ruling party, is established.

1992: PDS leader Sali Berisha is elected president and slowly gains a near-monopoly in the government. The only significant Western investment in the country, a Coca-Cola factory, is built.

Jan. 15, 1997: The first of several shaky pyramid schemes, most based in the south, collapses. An estimated $1 billion - about 30 percent of Albania's GDP - was lost in the schemes by more than 2 million Albanians. The government is blamed by opposition parties of lying to people about the schemes.

March 2: Parliament declares a state of emergency, due to the takeover of several southern cities by protesters.

March 9: Mr. Berisha announces a coalition government and early elections, scheduled for June.

March 11: Unrest spreads to northern Albania; Army depots are looted.

March 13: Unrest engulfs all major cities and the evacuation of foreigners begins.

March 17: A delegation of Western European diplomats arrives in Albania to advise the government on how to quell the crisis.

March 18: A loose coalition of rebels in the south called the Committee for Public Salvation demands that Berisha resign.

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