Central Bank warns the government about its budget deficit

TIRANA, March 26؁ccording to statistics from the Bank of Albania, the first two months of 2009 have experienced an increase in the budget deficit. BoA reported that the fiscal deficit in 2008 reflected an increase in public debt by 55.6 percent of GDP, therefore limiting opportunities for future fiscal stimulations. However, fiscal indicators in 2009 are within the projected levels.
The parallel increase in expenses and public revenues has increased the public deficit for the period in question. According to BoA, “preservation of the budget deficit within the projected levels during the all of 2009 will be an optimal contribution to the to fiscal policy under the current economic situation. Such a contribution would materialize in the control of interest rate for government’s debt instruments, the service cost of public debt, and will create more opportunities for banks to finance the private sector in our economy.”