TIRANA, Nov. 3 – London-based European Bank for Reconstruction and Development says the Trans Adriatic Pipeline bringing Caspian gas to Europe will be Albania’s key driver of growth for the next couple of years.
The EBRD says Albania’s growth will be investment-driven as TAP has already entered its pipeline construction stage in its Albania section after the completion of access roads and bridges and expects the gas pipeline to trigger investment equal to 3 percent of the GDP, some Euro 300 million, in the next couple of years.
“We expect growth to remain mainly investment-driven as TAP construction enters its full extent in 2016-2017 with a total investment of about 1.5 per cent of GDP per year in each of these two years,” said the EBRD in its latest November Regional Economic Prospects report.
Albanian experts have described TAP as an opportunity that would benefit Albania both economically and politically, making the country an important hub of the international gas pipeline for the Western Balkans.
The EBRD has kept unchanged Albania’s GDP growth forecast for 2016 and 2017 at 3.3 percent and 3.5 percent respectively. The forecasts are slightly lower compared to the Albanian government’s more optimistic expectations of 3.4 percent for 2016 and 3.9 percent for 2017.
The EBRD also expects neighbouring Greece, the country’s traditional second largest partner, to deliver zero growth for 2017 after its economy contracted by 0.7 percent in the year’s first half.
Albania’s trade exchanges with neighbouring Greece have suffered a sharp decline in the past eight crisis year following Greece’s six-year recession that saw its economy shrink by about a quarter from 2009 to 2014.
The EBRD had earlier warned “Albania’s strong trade, investment and remittance ties to Greece and Italy, both of which face continued economic gloom, are likely to continue to constrain growth and the high level of public debt will limit the room for fiscal manoeuvre.”
Since the start of its operations in Albania, the EBRD has invested almost €1 billion in over 70 projects in various sectors of the country’s economy.
