TIRANA, Nov 2ccording to the Prime Minister of Albania, Sali Berisha, economy performed relatively well this year despite the global economic crisis that has hampered global economic growth.
“The Albanian economy successfully managed to cope with the most severe crisis that Europe and the world has ever seen since 1930,” Berisha was quoted as saying by ATA, an Albanian news agency. “2009 marked the greatest wage increase in the history of the country, and marked an increase in budgetary income of about 8% compared to last year.”
In addition, Berisha added that Albania also showed its highest rate of increase in foreign investment at 59%, and sharpest rise in new infrastructure and public works.
INSTAT, the national statistics agency has estimated growth at 5.3% in the second quarter. According to the International Monetary Fund (IMF), which has urged the government to end fiscal stimulus and set realistic targets in the 2010 budget, the economy will show 2% growth in 2009.
Revising upwards its earlier forecast of 0.7% growth, the IMF said it had seen fairly strong Albanian economic activity in the first part of the year and a slowdown in the second.
“Growth for 2010 is likely to be 3%, a relatively high number for Europe,” the IMF’s Albania section chief, Gerwin Bell, said last week.
IMF welcomed sound macroeconomic policies in place for a number of years, which had allowed the government to build up a good fiscal position and allow a healthy financial system to take root.
However, Bell and his Fund insisted that the government should be realistic on budgetary income and expenditure.
“Moreover, a strong fiscal position, declining public debt and improving external position will be absolutely critical when Albania goes to international debt markets to finance,” Bell said.
Government not to blame for Lek’s depreciation
In an interview for Shqip, a major Albanian newspaper, Berisha said his government was not to blame for a depreciation of the country’s currency in the autumn. Berisha implied that a stronger euro was a problem of the European Union.
“We should mention that the Lek has saved its position (in the global crisis) better than all regional currencies,” Berisha claimed for Shqip. “I think that the Bank of Albania managed the problem with high efficiency.”
The Lek slid to near-record lows in September after Berisha proposed at a central bankers’ conference in Tirana that Albania should adopt the euro to boost its economy. Depreciation in 2009 has reached 12% and according to the Albanian Central Bank, the government’s spending craze and public borrowing are the main culprits behind the worrisome performance of the Lek.
