Government optimistic to sustain growth on current agenda

TIRANA, Dec. 13 – Government hailed the World Bank report on the new growth agenda, saying that it will serve as a basic document on the policies and measures it will take to keep the economy growing. Addressing the participants at the launch of the report, Finance Minister Ridvan Bode reconfirmed the Albanian government’s stance that the new growth agenda will continue relying on the country’s macroeconomic stability and preservation of key indicators such as the public debt, deficit, inflation, unemployment and currency exchange rate.
“The new growth agenda will not be an organized, concentrated, planned or detailed model but a model based on evidenced and successful principles during the whole transition period of the Albanian economy,” said Bode.
Government’s second goal is to preserve a favourable microeconomic environment for businesses through direct low tax policies. The banking system, accounting for 90 percent of the country’s financial system, will continue remaining a key partner in efforts to facilitate the companies’ investment strategies. Government’s mid-term goal is administrate not more than 31 percent of the GDP and leave the rest to strategies and choices of the business world under free enterprise, said Finance Minister Bode.
Albania’s economic model, based on a totally liberal stance to businesses and policies supporting them, makes government confident of a future positive performance after managing to keep the economy growing in the crisis of 2009. Government expects the economy to grow by 4.1 percent this year, up from 3.3 percent in 2009. Officials say the GDP will grow by 5 percent in 2011, 6.1 percent in 2012 and 6.2 percent in 2013.
Meanwhile, the International Monetary Fund (IMF) expects the Albanian economy to grow by 3 percent this year and 3.5 percent in 2011 under the new estimates, yet, almost twice less compared to government’s GDP projections.
The public debt, currently at a record 59.5 percent of the GDP is expected to drop by only 0.5 percent under the new 2011 budget which has also been decreed by President Bamir Topi. The Albanian economy continues growing at low rates mainly because of the ongoing crisis in the construction sector, lower foreign direct investment and immigrant remittances triggered by the global economic crisis.
The latest data published by the Institute of Statistics (INSTAT) show the Albanian economy grew by 3.3 percent year-on-year in the second quarter of this year and 2.4 percent compared to the first quarter of 2010.