EU report focused on economy

The Commission analyzes with details the economy from two main views: its current situation and the government’s reform progress. The report starts by commenting the government’s finances with concern, which remain one of the biggest weaknesses in the Albanian economy. “The main objective of the government is the macro-economic stability, which has been resolved in general. “The main objective of the government is the macroeconomic stability, which has been generally preserved. But the enlargement of the deficit brought a further growth of the already high public debt, by deteriorating the fiscal weaknesses”, the report says.

As regards the economic growth, the report notes the living standard growth, compared to the EU average from 28% in 2010 to 31% in 2011. However, according to the Commission, the economic growth is slowing down.

“The GDP growth fell to 3.1% in 2011, from 3.8% that it was in 2010. As for the first trimester 2012, the economy shrank with 0.2% due to the plunge of the industrial and construction production”, the report continues.

Another important problem, according to the Commission, is the unemployment.

“The job market conditions have improved, and although it is less than last year, the unemployment remains high. One fourth of the unemployed are long-term, and reflect its structural nature”, the report says, while there have also been concerns for the current deficit and the growth of bad loans, as two additional dangers for the economic stability. But the deterioration of the economic indicators is not the only problem. The report notes that the reform progress remains insufficient. The privatizations are in a stalemate and the institutional preparation for protecting the property rights and for guaranteeing the law implementation is weak and remains a concern”, the report continues.

The Commission says that the weakness and the unfulfilled reforms for property and corruption still have a negative effect in the business climate, making it visible that the political situation makes the reforms even more challenging.

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