The Economist, in its latest issue, has devoted an article to the money laundering phenomenon that is flourishing in the Balkans.
The real estate market is being seen as a good place to hide illegally earned money.
The article writes that all over the Balkans, dirty money is being laundered through real estate, distorting the market and raising prices – causing the anger of ordinary people who want to buy a house. New luxury towers are being erected in Tirana, Pristina and Belgrade.
Although the Balkan economies have been hit hard by Covid-19, property prices in parts of the region have defied the crisis. In Tirana, they have more than doubled since 2017. Across Albania, the value of real estate transactions increased by 6.7% in 2020.
Money laundering of drugs, especially from cocaine trafficking, which has flourished in recent years, is one reason why prices are rising, found a new report from the Global Initiative Against Organized Crime, an international network of crime specialists. Another reason is that corrupt officials have to invest their money. All Balkan countries have good laws to prevent money laundering, but implementation leaves much to be desired.
In the last decade, crime syndicates in the Balkans have developed beyond their countries of origin. They now earn a lot of money abroad. Therefore, the report says, a large part of their profits is also invested abroad. But they still invest in their country of origin. Fatjona Mejdini, who helped research the report, says Balkan governments are skeptical about money laundering. They want to hit it off, but at the same time welcome the jobs and investments they can bring.
When it comes to the “strong”, although they are brutal in the way they make their money, they appear conservative in the way they invest them. They “lack imagination”, says Ms. Mejdini, and this is one of the reasons why they prefer mortar and bricks to other types of business that they could use to launder their money, the article concludes.
