Albanian economic levels keep dropping

Since the beginning of the recession, Albania has been the country with the highest growth in the Balkan, besides Kosovo.

According to the World Bank, the National Production from 2008 to 2012 grew with 13%, when most of the countries in the region had a negative growth.

But the tendency changed last year. Albania not only lost the leadership in the region, but, according to the International Monetary Fund and the World Bank, Albania was the country with the lowest growth, besides Bosnia.

According to the International Monetary Fund, the economies of the five Balkan countries that are not part of the European Union marked an average growth of 1.7 in 2013.

The most recent assessment in Albania showed a growth of 1.3%, but the strong dropping in production during the third trimester of 2013 year makes this figure impossible for that year, meaning that the gap between the other countries will be even bigger.

But 2013 was not an isolated case. Two days ago, the World Bank published the report of the world economic perspective, stating that even this year, Albania will again be one of the countries with the lowest growth among the developing economies of Europe and Asia. According to the Bank, this situation will continue for three years, until 2018.

But why is Albania remaining behind other countries? The World Bank says that there are several reasons, but two stand above everything else and are both related with the internal weakening of the economy.

The first one is related to the high level of bad loans, which has obliged banks to give fewer loans. The second reason is the crisis of the government finances, which imposes a tighter budget and tighter tax policy.

Higher taxes and fewer spending await even for the next year. All these factors weaken the internal demand even more, by stopping the economic growth and by leaving Albania with the lowest revenues in the region, besides Bosnia.

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