The Vienna Institute’s expectations for Albania’s GDP growth, at over 4 percent for the next two years, are far more optimistic compared to other international financial institutions such as the IMF and the World Bank
TIRANA, July 17 – The Vienna Institute for International Economic Studies, a leading European research center on developments in Central, Eastern and Southeastern Europe, remains concerned about the ongoing political stalemate in Albania and its escalations following last May’s local elections. A recent report published by the Institute describes Albania’s development as adolescent and expresses concern over the impacts the ongoing political crisis might have on the economy.
However, the Vienna Institute’s expectations for Albania’s GDP growth, at over 4 percent for the next two years, are far more optimistic compared to other international financial institutions such as the IMF and the World Bank. The International Monetary Fund has lowered Albania’s growth to 2.7 percent in 2011 while the World Bank expects the economy to grow by 3.7 percent compared to government’s 5 percent estimate after making forced budget cuts to keep rising deficit and public debt levels in check.
“In Albania, the political system is still showing signs of pubescence. The recent municipal elections culminated in a fierce dispute over the outcome of the ballot in the country’s capital, Tirana. Nevertheless, in terms of economic development things seem to be improving. The growth rate for 2011 is expected to be slightly over 4%. A similar growth rate is expected for 2012 and a somewhat higher rate for 2013. The main drivers are further export growth and an improvement in consumer and business confidence,” says the report by the Vienna Institute.
Experts of this Institute expect the Albanian economy to grow by 4.1 percent this year, 3.9 percent in 2012 and 5 percent in 2013.
The Institute expects the inflation rate to be at 4 percent in the next three year, which is the maximum target set by the country’s central bank.
Data on unemployment rate and public debts differ from those of the Albanian government with 2010 unemployment reported at 15 percent, 1.5 percent higher than INSTAT and public debt at 61 percent of the GDP compared to 59.7 level claimed by government officials.
For the period 2011-2013, the Vienna Institute expects a gradual increase in the GDP growth rate. The forecast hinges on further recovery of the European economy and governmental stimulus of domestic demand.
