World Bank: Cautioun with debt
15/11/2011 00:00
Linda Rama: Between Family, Work and Albania’s Future 18/08 14:30
The World Bank warned the Albanian government that the Eurozone crisis
and the slowdown of the economic growth could deteriorate the economic
debt by causing budget difficulties.
“These are the refinancing problems. Financing debts now has become difficult, especially for external debts. Another danger could be the interest rate increase. There’s always the problem of the growing burden of interest rates”, declared Erjon Luci, World Bank economist.
Albania is paying the highest price in the region for debts. In 2010, the Albanian government paid 3.4% of the GDP only for interests, when other similar economies in Western Balkan paid only 0.6 or 1.3%. WB says that the shrinking of the economic growth could oblige the Albanian government to undertake other public finance interventions.
“The decrease of the economic growth in the region and Albania could create some kind of pressure on the finances, for increasing or adjusting the expenses. The negative effect is in the further adjustments aspect”, Luci declared.
The debt of the Albanian government is 2.2 times higher than the annual revenues, one of the biggest indicators in the world.
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