Albania’s GDP growth ranked top third among EU aspirants

TIRANA, April 11 – Albania registered the third highest GDP growth in 2010 among 9 EU candidate and potential candidate countries in the Balkan region including Iceland. Latest data made available by the European Commission’s Directorate General for Economic and Financial Affairs show Albania’s 2010 economic growth at 4.1 percent was not high enough only compared to EU candidate Turkey whose GDP is estimated to have grown by a record 8.9 percent compared to Albania’s 4.1 percent and Kosovo’s 4.6 percent.
Only Croatia and Iceland recorded negative growth rates of -1.2 and -3.5 percent respectively in 2010 while growth in Bosnia-Herzegovina, FYROM, Montenegro and Serbia varied from 0.7 percent to 1.8 percent.
“Albania remains an outlier in the region, as the country weathered the crisis without a recession, and GDP grew by a further 5.7% in the last quarter of 2010,” says the report.
“Credit growth recorded a high level of 30% in Turkey, but remained below 10% in most Western Balkan countries, including Albania (+8%), the country with the highest growth in the region. Public finances, which had been severely impacted by the crisis in 2009, improved significantly in 2010 in Turkey and Albania where the deficit was reduced by 42% and 58% respectively.” The report also cites the credit rating agency Standard & Poor’s which recently kept Albania’s sovereign rating stable at ‘B+B’ because of the country’s low per capita GDP level, high government debt and a polarised political environment which constrains the government’s ability to press ahead with reforms.
However, Albania’s Gross Domestic Product (GDP) per inhabitant expressed in purchasing power standards (PPS) is less than one third of the EU-27 average and even below regional competitor Bosnia and Herzegovina which stood at 31 percent in 2009, according to Eurostat.
Latest Eurostat data show Albania GDP per capita dropped to 2,661 euros in 2009, down from 2,784 in 2008, remaining better only compared to Kosovo which registered 1,790 euros compared to the EU 27 average of 23,500 euros.
Meanwhile, data from Albania’s Institute of Statistics show the Albanian economy grew by 3.9 percent in 2010, 0.2 percent below government’s expectations but far better compared to the 3 percent GPD growth forecast by international financial institutions such as the World Bank, the IMF and the EBRD.
INSTAT figures show the country’s GDP grew by 5.4 percent in the final quarter of 2010 with industry and trade as the key sectors contributing to the growth while the construction and post-telecommunication sectors continued suffering registering negative growth rates.