Last month, the Albanian government changed the tax law and reinforced
the procedures for the executing the pledges, but bad loan didn’t get
better. For Nadeem Ilahi, the reason is a mystery for the IMF experts
too.
“There is something in the system that is not dropping bad loans. We do not know what it is. Why unpaid loans are continuing to be there even after a series of measures were take for reducing them?W e agreed with the government to see the problem from a wider view, from all aspects. Not only as a banking problem, but in general. How are the agreements executed, how the collateral works, how the court verdicts work. This could help identify the problem”, declared the Head of the Mission, Nadeem Ilahi.
According to Mr.Ilahi, this is a stalemate that needs a quick solutio, otherwise there could be huge costs for the economy.
“In this phase, while the economy is being recovered, you will start to see a revival of the requests for loans. But if banks will hesitate to give loans during this time, due to the fear that they might not be paid, the country might have problems with the economic growth. This is a problem that you would not want to face”, Ilahi declared.
Besides the legal amends, the government has paid more than 500 million USD in delayed payments. But this didn’t reduce the problematic loans neither, as expected. The opposition accuses that the debt payment process is not transparent and the government is hiding the audit.
“The audit work is not over yet. They have made a preliminary report on which we have based our evaluations. I think that after the process is over, a certain level of information might be made public. This is not a problem, but yet, allow me to say that this was done to allow us to make the evaluation if the debt payment process is done properly. We haven’t had any problem so far with this”, Ilahi declared.
By the end of the interview, the Chief of the Commission commented the government projects for building roads through concessions, and asked them to be careful, because this might cause another hidden debt growth.
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