Debt prevention

“It is a great concern, and this mechanism needs a lot of professional debate”, says the expert Selami Xhepa.

But the experts are divided on the way how the debt should be taken under control. Selami Xhepa, a right centered MP, says that the best way is that of limiting the expenses by law.

“A more efficient law would be the establishment of a rule that increases the norm of public expenses at the level of the economic growth, which would reduce the debt gradually”, Xhepa suggests.

The other Democratic MP, Sybi Hida, supports the other version that empowers the Parliament Competences and those of independent experts in the management and observation of the debt.

“The macroeconomic predictions should not be made by the government, but by a special group of independent experts that will be near the Parliament”, Hida proposed.

The opposition has also expressed its concern about the budget threats when the debt limits are crossed or its usage for electoral interests.

The MPs have given some propositions recently, one of which was that of Ben Blushi, who suggested to limit the debt through the Constitution. The fear from debt made the government’s treasury bonds reduce.

Debt urge

The governments find it difficult to resist the debts, not only during crises, but also in good economic times.

2008 was the best year for Albania’s public finances, at least in the last decades. The revenues hiked with 500 million USD, the strongest historical increase.

But the debt not only did not reduce, but it even increased, because on the verge of the elections, the government made more expenses than the revenues.

The situation deteriorated one year later, when the global crisis coincided with the general elections. The deficit went over 7% of the national production, and the debt reached the 60% limit.

There is an expression among the public finances circles, which says that the debt is more addictive than drugs and alcohol.

To prevent the government from creating addictions, the system has given the citizens only one mechanism, the Parliament. Experience has shown that this is not enough, even in democratic countries, where the Parliament really doesn’t serve only to the government.

In delicate democracies like Albania’s, where the chances that the Parliament will oppose the government are almost zero, the need to limit the government is even higher. Otherwise, all worst scenarios are probable to happen.

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