EBRD’s Chakrabarti called on the Albanian government to undertake further reform that would improve the business climate and keep the economy growing
TIRANA, Feb. 7 – London-based European Bank for Reconstruction and Development has reconfirmed support to Albania, where it has emerged as one of the largest investors in the private sector. During his first visit to Albania this week, EBRD President Suma Chakrabarti discussed investment priorities for the country with senior officials. In a joint press conference with Prime Minister Sali Berisha, Chakrabarti called on the Albanian government to undertake further reform that would improve the business climate and keep the economy growing. “We think that further reforms are needed in the tax administration, land ownership and the legal framework, which of course are difficult issues for a country. The further improvement of the business climate would help us bring more investors to this country,” said Chakrabarti.
Speaking of the public debt, Chakrabarti said it is the local authorities who determine its ceiling. “The question is that at a certain moment the country lacks fiscal space and must increase its debt. I think Albania has decided it is time to attract more private investment to regain strength to achieve growth and development.”
Meanwhile, Prime Minister Berisha assured Albania’s public debt was ‘benign” because of focusing on infrastructure investments and because two-thirds of it is in the local currency.
The Albanian government has lifted the 60 percent of the GDP ceiling, and announced it targets a 63 percent level for 2013 in an effort which it says will further stimulate the economy.
The EBRD is one of the largest investors in the private sector in Albania. Its main areas of focus are supporting the financial sector and small and medium-sized businesses, improving infrastructure, and developing natural resources.
The Bank has invested in important infrastructure projects such as the modernisation of Tirana International Airport, the Port of Durr쳠passenger terminal , and in programmes to modernise regional and local roads- all projects which support economic improvements in the country.
Since the beginning of its operations in Albania the EBRD has invested over Euro 700 million in various sectors of the country’s economy, mobilising additional investments of over Euro 1.65 billion.
London-based EBRD, one of the largest investors in the private sector in Albania, has revised upward Albania’s GDP growth forecast for 2012 and 2013 following a report by state Institute of Statistics, INSTAT, showing the Albanian economy grew by 2.7 percent year-on-year in the third quarter of 2012. In its latest economic outlook issued this week, the European Bank for Reconstruction and Development expects the Albanian economy to grow by 1.8 percent in 2012 and 2 percent in 2013 up from 0.6 percent and 1.3 percent respectively last October.
In its new forecast, the EBRD warns close links to crisis hit top trade partners Greece and Italy will continue to limit growth in 2013.
