Bode: Public Investments, 18% Less Than Planned

The Albanian Finance Minister, Ridvan Bode, admitted on Tuesday that 18 percent of money to fund public investment and projects was not spent during the first quarter of 2008. According to Bode, USD 120 million had been set aside in the state budget for investments and, during the first quarter, remained unused. “The state budget data for the end of the first quarter shows a surplus of ALL 10 billion, which the government chose to invest in short term loans to the banking system, or to help KESH (The Albanian Power Corporation) with short-term working capital loans. The above mentioned funds, and future surpluses and the programmed deficit as well, are set aside to support the acceleration of public investments in the future”, said Bode.
Nevertheless, Bode was satisfied with the result. Bode compared the first quarter of 2008 to the first quarter of 2007. “Regarding the investments, I would like to point out that there are realized investments worth ALL 53 billion out of ALL 64.7 billion planned in the budget. Therefore, there is a difference of 18 percent compared to the plan, but the realised investments were 8.9 percent higher than during the same period last year”, Bode said.
Bode pointed out a number of reasons for the poor performance of state institutions.
First, the government has planned to use a record-high 10 percent of the country’s GDP for public investments, “something which demands rhythmic spending of the funds allocated for public investments”.
Second, the first quarter is comparatively slower because state institutions are still at the procurement phase of their projects.
Third, the Ministry of Public Works, Transport and Telecommunications has the capacity to increase its public investments, but for the moment, it has chosen to be very cautious in its investments.
Bode admitted that the increasing revenue surplus is going to increase pressure to allocate more funds for public investments.