“Albania should speed up reforms and EU integration in face of possible economic decline,” WB says

Tirana Times
By Tirana Times April 3, 2019 12:20

“Albania should speed up reforms and EU integration in face of possible economic decline,” WB says

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  • According to the report, Albania's economic growth this year may resume a downward trend due to several deterrent factors, among which are the climatic conditions and the country’s political situation.

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TIRANA, April 3 – The World Bank said on Tuesday Albania’s economic growth could stagnate this year due to the drought, as last year’s production and export of electricity took the lead in economic growth.

Experts also claimed that structural reforms and efforts to integrate within the EU should continue both in Albania and in the region.

The World Bank made these comments during the publication of its Regional Economic Report.

According to the report, Albania’s economic growth this year may resume a downward trend due to several deterrent factors, among which are the climatic conditions and the country’s political situation.

“Political uncertainty and delays in implementing structural reforms can undermine both the business climate and the progress of EU membership, which should continue to be one of the country’s main goals,” said Ilda Shijaku, World Bank expert.

According to the WB report, it is vital to move reforms forwards in order to mitigate risks and increasing public discontent.

Further on, the World Bank says the protests that have involved not just Albania, but some countries in the region are a sign of insecurity.

“The protests that are noticed in many Balkan countries are also related to delays in implementing structural reforms. For those cases they relate to economic uncertainty or difficult economic conditions and uncertainty about the future, the authorities of those countries should take measures to accelerate structural reforms by facilitating labor market integration through investment in human capital, improving the business climate and creating equal development conditions for all,” Shijaku said.

According to the World Bank, the main task remains the improvement of the business climate and law enforcement, because this year the economy will grow less than last year.

“Fiscal risks are present and relate mainly to off-balance sheet activities, including Public Private Partnerships, as well as liabilities accumulated by public utilities,” said Shijaku.

The growth in electricity production and export helped the economy increase by 1.5 percent to a total of four per cent, but foreign direct investments are now taking place at a slow pace.

Among the external risks are the trade wars taking place between other states and the economic difficulties neighboring countries are going through.

“Another external risk factor is a slower pace in the economic growth of EU countries, especially Italy, which recorded recession recently. Also, the conditions for borrowing are also less favorable, thus increasing Albania’s costs, already significantly exposed to foreign lending of money,” Shijaku said.

Economic growth, according to experts, came mainly from the increase in domestic demand and a largest trade consumption.

Albania, the World Bank reported, experienced an economic growth of over 4 percent last year, public debt declined and jobs increased, but structural reforms and the path towards the EU need to be sped up.

 

Tirana Times
By Tirana Times April 3, 2019 12:20