Albanian economic slowdown

25/01/2014 00:00

The EBRD (European Bank for Reconstruction and Development”) assesses
that the fiscal consolidation conditioned by the new agreement of the
government with the International Monetary Fund will block the economic
growth of 2014.

In the recent report about the regional perspective, EBRD corrected the prediction for Albania’s economic growth during this year, from 2% that they valued in October, to 1.7% in January.

EBRD says that the economic growth for Albania in 2013 remained frozen due to the crisis in the neighboring countries, and also due to internal economic problems.

According to EBRD, these problems are related to the weak financial situation of businesses and the negative effect created by the government’s obligations. On the other hand, the Bank values that the public debt keeps growing while the weak points of the financial sector are evident with bad loans that go around 25%.

“The new government is committed to improve the business climate and a new agreement has been reached with the International Monetary Fund, which is expected to improve the fiscal stability”, the report noets.

According to EBRD, a very slight economic growth is expected for the entire 2013, since the Bank thinks that the fiscal obligations, conditioned by the agreement with the International Monetary Fund, will stop the positive effects that come from the increased foreign and internal demand.

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