Loan crisis in Albania
02/07/2013 15:10
Accidents are increasing in Tirana, experts: The road is becoming dangerous for drivers and pedestrians 18/11 15:46
Albania has officially entered a loan crisis. Recent official data
suggest that for the first time since 2002, the loan stock for the
private sector has started shrinking.
According to the Bank, the total loan for business on May was 370 billion ALL, from 373.2 billion that it was on May 2012. This means that the new loan that private enterprises have in banks has been lower than the payment of existing loans.
Since 2009, the loan growth pace has quickly decreased, but it has never been under zero so far, except for the last month.
Business is shrinking and the new investments are lower. The strong credit slowdown of the past year was the main cause that halved the economic growth from 3 to 1.6%.
Chances are that this year, with its entrance in a negative zone, the consequences could be even stronger. According to the Central Bank studies, the loan growth last year has accelerated the growth of the Gross Domestic Product with 1.5 to 2%.
This effect could turn negative by dimming hopes for a quick revival of the economy, when the Albanian Bank has itself admitted that the loan crisis can continue for a mid-term period.
Top Channel
