Public debt is growing

According to the Ministry of Finances, the government has taken the right to increase the debt to 59.1% by 2013, from 58.6% that it was some months ago.

The debt limit is changing every 5 months, always increasing, which shows the government’s difficulties to keep the public finances under control. After the crisis of 2009, when the debt reached 60%, the government promised in front of the public and the IMF that they would reduce it to 54% by 2013.

This promise was broken for the first time on February 2nd 2011, when the Strategic Planning Committee, led by the Prime Minister, approved the new law that increased the debt to 58.1% of the GDP until 2013. This resisted only a few months and in July, this limit was reviewed and increased to 58.6%. With the recent decision, the sovereign budget, the one that is taken on behalf of the Albanian citizens and that is paid by their taxes, increased again with 0.5%.

With this decision, the government will leave the public debt level unchanged until 2013, although it was asked by the IMF to reduce it as soon as possible. The programs that had given hopes that the government would reduce its debt in more stable levels have failed completely.

Albania will be keeping the maximal debt burden for two other years, always under the threat to cross the limit set by law. The dangers that may derive out of this are several, starting from the economic slowdown to the possible energy crisis or ALL devaluation.

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