World Bank criticizes government

“Some of the sectors will not be able to implement the important investment programs, such as education. The expenses of the Education Ministry were cut, which means that some of the most important investments will not be realized. The practice of changing these plans mid-year creates for the ministries the idea to hurry with advances in big projects for the first six months and neglecting maintenance. But the repeated maintenance negligence in midterm means that there will not be an optimal use of the public funds. Moreover, these changes create an insecurity sentiment for the businesses”, Lvovsky declared.

This is the third consequent year when unreal predictions oblige the government to cut the budget. In 2011 it predicted an economic increase of 5.5% higher than the average of the last five years before the crisis. Mrs. Lvovsky thinks that the government should recognize the fact that the economic reality has changed.

“The economic recovery in Europe has been weaker than 2 years ago, when the crisis was over. Albania is affected because its main partners, Greece and Italy, are facing the most serious crises. As we speak, we also have the problem of the US debt. The moral is that we live in another environment, in another world, with greater insecurities even for Albania, due to foreign factors. This new environment requires another approach to the economic reality, a different approach to what would be called reasonable some times ago. In these conditions, it would be very prudent to use more conservative assessments for the economic growth and for predicting the revenues”, Lvovsky declared.

The new 5.5% prediction of the Albanian government for the economic growth for the year has been commented again as very optimist.

“The keyword is insecurity. We think that the economic growth for this year will be 4%, but there are still many things that cannot be controlled and that could change these predictions. I think that Albania has very good experts at the Ministry of Finances, which every country would like to have. Albania has also been economically performing better than most of the European countries. However, it has had an optimist approach towards the external environment, which has been understood by the Ministry of Finance. We have had discussions with Ministry experts about this, and we would be happy to offer our help for planning the budget of the next year”, Lvovsky declared.

The bank advises the government to be more conservative, because this would enable excessive incomes that could be used for decreasing the debt, which has stalled at the dangerous level of 60%.

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