IMF: “Albania enjoys the fastest growth, but it may not last”

20/03/2018 18:12

An IMF mission led by Mrs.Anita Tuladhar visited Tirana from March 7th to March 20th to discuss the first Post-Program Monitoring.

The conclusions reached after the visit were that Albania is enjoying one of the fastest economic growths in the region, but there is the risk that it could not last.

“Albania enjoys one of the fastest economic growths in the region, possibly reaching 3.7% during 2018. Funding conditions are favourable, while the inflation and interest rates are still very low. The level of investments is increasing while there is more trust. Exports are growing, supported by the strong economic recovery of EU commercial partners. The currency reserves of the Bank of Albania cover imports for six months while The incoming flux of direct foreign investments continues with a stable pace. Although the recovery has not been supported by credit, the banking system is stable, liquid and rentable. The forecast for Albania’s economic growth remains positive, with the condition to accelerate the pace of reforms, increased trust and create a favourable environment for new investments”, the IMF conclusions say.

According to the IMF, the risk that the Albanian economy is facing is that this growth may not last.

“The economic growth of the EU has been positive since 2016, but it is generally cyclic and the mid-term prediction remains low, due to unresolved problems left behind by the crisis, low growth of productivity and prohibitive demographic factors. There are global risks from a sudden correction of financial markets, political insecurities and protectionist policies which could reduce trust and slow down the economic growth. The slowdown would affect Albania negatively in trade canals, investments and the banking sector”, says the IMF declaration.

The declaration adds that this is the right time to accelerate the reforms in order to reduce the risks and create protection against undesirable shocks in the future.

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