The 50 million Euro loans which BSTDB plans to give to companies operating in Albania is almost twice as high as the current loan portfolio
TIRANA, June 20 – The Black Sea Trade and Development Bank (BSTDB) plans to lend over 50 million Euros in Albania during the 2011-2014 period mainly focusing on trade related activities, the development of infrastructure and energy efficiency. The lending strategy for the next four years in Albania was announced during an annual meeting of the BSTDB’s board of directors held last weekend in Tirana. The 50 million Euro loans which BSTDB plans to give to companies operating in Albania is almost twice as high as the current loan portfolio.
BSTDB’s portfolio in Albania consisted of seven approved operations with a total amount of 61.4 million EUR at the end 2010. The portfolio is well diversified and includes investment in telecommunications, steel production and health (Albtelecom, Kurum International and Hygeia Hospital). In 2010, BSTDB also invested in Albanian government bonds worth EUR 10 million.
Andrey Kondakov, the BSTDB’s president says the agriculture and tourism sector will also be financially supported during the next four years.
The bank supports both the private and the public sectors. Private sector support starts from 3 million Euros to 40 million Euros. Albania has been one of the primary member countries of the BSTD since 1997, and is represented by deputy Minister of Finance Nezir Haldeda. Its shareholding percentage is 2 percent.
The BSTDB says it will focus in the next four years on providing support for the implementation of the government program and priorities, while responding to market demand. The Bank will consider undertaking activities and providing services that may advance its purpose, paying special attention to activities promoting the export of goods and services. In addition, through selected intermediaries, the Bank will attempt to expand its financing programs in favor of small and medium sized enterprises. Based on the 2011- 2014 BSTDB medium-term strategy and business plan, the Bank expects to approve about 1 new operation per annum during this period, for approximately EUR 12.6 million per year. Over the four year period, this implies around 4 to 5 approved operations for approximately 44 to 56 million EUR. With the Bank determined to raise the level of commitments (signed operations) of approved operations to over 85%, the Bank expects signings for 2011-2014 to be on the order of 3 to 4 operations for EUR 44.5 million (a range of EUR 39.1 to EUR 49.8 million).
Forecast for 2011-2014
The Black Sea Trade and Development Bank (BSTDB) expects the Albanian economy to grow by 3.7 percent in 2011, up from 3.1 percent in 2010 and the inflation rate to remain within the central bank’s target of 3ѱ percent.
“The preservation of macroeconomic stability, keeping the inflation rate around 3 percent, reducing the deficit and public debt to the level of 54 per cent for 2013, as well as reducing the current account deficit, constitute the basic objectives of the coordinated monetary and fiscal policies of the country,” says the BSTDB.
The current-account deficit is expected to narrow to an average of 9.3% of GDP in 2010-11, from an estimated 15.6% of GDP in 2009.Thus, these objectives make up the main elements of the macro-economic framework within which the projections for all the other macroeconomic variables are drafted.
The macroeconomic program of the Albanian government for 2011-2014 outlines that, along with the technological progress and structural reforms of the economy, the implementation of a series of efficient macroeconomic policies clearly oriented by the “philosophy” of boosting the economic growth through promoting the aggregate supply, would give a significant push to the economy. Pursuing well-planned and well-coordinated macroeconomic policies and enhancing the economic-structural reforms, along with technological progress and accumulation of capital, would ensure the continuation of such economic dynamics for at least a medium term period.
Albania has good growth potential in agriculture, fisheries, forestry, tourism, mining, and light industry. Sustainable growth that will benefit the entire population can be achieved, provided the country maintains stability and tackles its most pressing challenges such as the strengthening of the public sector, improvements of infrastructure, and access to finance particularly for SMEs.
The Bank considers progress with implementation of structural reforms necessary to maintain Albania’s high growth potential.
